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A S I A’ S L E A D I N G P O W E R R E P O R T VOLUME 2, ISSUE 2

CHINA: FEEDING

THE ENERGY DRAGON

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FEATURES INSIDE: Hydrogen & Fuel Cells Asia | Chinese Hydro Power Market | Wind Asia | Nuclear Developments Asia | Smart Grid | Saudi Aramco Interview | The Indian Ministry of Environment and Forestry PI_MarApr_Cover.indd 1

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WELCOME So as we move through our editorial calendar, this month we look at China, Asia’s27 energy Dragon!

China is the world’s second largest oil consumer behind the United States, and the largest global energy consumer, according to the International Energy Agency (IEA).

CONTACT US: Editor: Charles Fox Journalist: Robin Samuels Creative Director: Colin Halliday Sales Director: Jacob Gold Business Sales Manager: Sam Thomas Account Manager: Daniel Rogers Accounts & Customer Service Manager: Katherine Stinchcombe Managing Director: Sean Stinchcombe SKS GLOBAL LIMITED Kingswood House South Road Kingswood Bristol UK BS15 8JF E: info@sks-global.com W: www.pimagazine-asia.com W: www.sks-global.com T: +44 (0) 1179 606452 F: +44 (0) 1179 608126

China was a net oil exporter until the early 1990s and became the world’s second largest net importer of oil in 2009. China’s oil consumption growth accounted for over a third of the world’s oil consumption growth in 2010. Natural gas usage in China has also increased rapidly in recent years, and China has looked to raise natural gas imports via pipeline and liquefied natural gas (LNG). China is also the world’s largest producer and consumer of coal, accounting for almost half of the world’s coal consumption, an important factor in world energy- related CO2 emissions.

These are of course just some of the facts and details are included within, so please turn on through to read the indepth review we have put together.

So in the coming months we will be all over, we will have a large both at the Powergen India Show, we will be at Intersolar India/China, and many other events, which are listed later in the magazine.

Feel free to drop by our booths, meet our staff and grab a few extra editions of the magazines.

78edition, any questions, news or information I hope that you enjoy this releases you may have, please email them to me at Charlie@pimagazineasia.com.

All the best

SKS Global Power Insider Asia magazine is published bi-monthly and is distributed to senior decision makers throughout Asia and the Pacific.

The publishers do not sponsor or otherwise support any substance or service advertised or mentioned in this book; nor is the publisher responsible for the accuracy of any statement in this publication.

Copyright: the entire content of this publication is protected by copyright, full details of which are available from the publisher. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electric, mechanical, photocopying, recording or otherwise without the prior permission of the copyright owner.

CHARLES 56FOX EDITOR

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CONTENTS 6

News China: 27 ‘Feeding The Energy Dragon’

12

China Hydro Report

24

Blowing Up A Storm In China

26

Feature Interview With J. M. Mauskar

28

Direct Aircooled Condenser Tubes

30

Dry Cooling Round Table

32

India Small Hydro Power Catch-Up

38

Coal India

40

Raw Coal Feeders

48

Nuclear Power Back From The Grave?

50

Smart Grid

54

Saudi Aramco: An Ambitious Story

56

Greener Cooling Systems

60

Fuel Cell Technology

64

Actuator Performance

66

Billions Blown Away On Wind Power!

70

Asian Solar Market Developments

72

78

56

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NEWS DESK SMART GRID PLAYERS TO SHIFT FOCUS TO APPLICATIONS FROM DEPLOYMENT Greentech Lead India: The smart grid sector will shift its focus from infrastructure deployment to applications in 2012.

“Utilities need to prove to both end-use customers and regulators that the adoption of smart grid technologies, such as smart meters, has been worthwhile in either reducing costs or boosting energy efficiency,” said Pike Research vice president Bob Gohn.

Relatively simple applications such as prepaid metering services should be straightforward, while others, like the integration of distribution automation (DA) with advanced metering infrastructure (AMI), and the adoption of microgrids, are more ambitious.

Major challenges remain, as continuing consumer pushback against smart meters is likely to extend to dynamic pricing program rollouts and home area networking, threatening some of the key principles of smart grid investments.

Pike Research’s smart grid industry predictions include the following: t Smart meters will shift from deployment to applications t Dynamic pricing debates will escalate t Architecture will be the new buzzword t Cyber security failures will become almost inevitable t Consumer backlash against smart meters will not go away t Distribution automation and AMI will intersect t Microgrids will move from curiosity to reality t The freeze on home area networks will begin to thaw - just a little t Asia Pacific smart grid adoption will accelerate even faster t Stimulus investments will bear mixed fruit Malaysia Smart Grid market to grow to $109 million by 2016 from $35 million in 2011.

The Malaysia Smart Grid technology market is likely to grow to $109.0 million by 2016 from $35.2 million in 2011.

The demand for energy consumption in Malaysia is projected to increase by 5 percent per year over the next five years, and is likely to double in the next 20 years, according to the new report from Zpryme, Malaysia: The Smart Grid Has Landed.

To meet this need, Malaysia’s largest utility, Tenaga Nasional Berhad (TNB), has undertaken a Smart Grid.

COMPANY NEWS FROM AROUND THE WORLD

Siemens to deliver two world record gas turbines to South Korea

Siemens is again to deliver state-of-the-art power plant technology to South Korea.

For the Ansan combined cycle power plant (CCPP), the company is supplying two innovative Hclass gas turbines, one steam turbine, three

generators and two heat recovery steam generators as well as the entire instrumentation and control technology. Ansan is now the second power plant in South Korea to be equipped with Siemens’ flagship gas turbine technology. The customer is the South Korean company Posco Engineering & Construction Co. Ltd., headquartered in

Incheon, which is responsible for construction of the entire plant.

The CCPP Ansan will be fueled with liquefied natural gas (LNG) and will have a gross installed electrical capacity of 834 megawatts (MW). In addition to generating electricity, the plant will also provide district heating for the inhabitants of the city

of Ansan, which raises the overall fuel utilization factor to over 75 percent. Commissioning is planned for the end of 2014.

Cummins keeps the peace at Fiji’s Likuliku Resort

The Likuliku Lagoon Resort, located in the middle of Fiji’s Mamanuca archipelago, sits amidst a turquoise lagoon

of incomparable beauty and tranquility. The name, “Likuliku”, means, “calm waters” and is a luxurious escape retreat.

However, managing the beautiful but remote Likuliku Resort has been anything but calm for the Ahura Resorts Group team as they were having trouble establishing effective power solutions for

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DEPED GETS $1.5-M GRANT FROM JAPAN The Department of Education (DepEd) has received a grant of $1.5 million from the Japan Fund for Poverty Reduction (JFPR) to develop public kindergarten schools, particularly those in poor communities.

DepEd is pushing its program to set up kindergarten in all public elementary schools following the enactment of the Kindergarten Law, making kindergarten a requisite to entry to Grade 1.

The Asian Development Bank (ADB) administers the JFPR pursuant to an agreement ADB has entered into with the government of Japan.

Activities to improve public kindergarten schools will be implemented by the Aklat, Gabay, Tungo sa Pag-angat at Pag-asa (AGAPP) Foundation headed

by President Aquino’s sister, Aurora “Pinky” Aquino-Abellada.

The project aims to support DepEd’s K+12 program, particularly in the institutionalization of kindergarten through classroom constructions,

curriculum development and teacher trainings.

Education Secretary Armin Luistro yesterday signed a letter of agreement with Japanese Ambassador Toshinao Urabe, Aquino-Abellada, and ADB South East Asia regional director Kunio Senga for the grant in ceremonies held at the DepEd central office in Ortigas, Pasig City.

Luistro said the grant was a “most welcome development” because it affirms DepEd’s position on the importance of basic education.

“Kindergarten is a very important building block in producing quality graduates of basic education, so we should really start on a solid footing by preparing our young learners very well,” he said.

The grant will finance expanded access to kindergarten education by providing necessary school infrastructure and facilities. It will also enhance the capability of teachers by providing them trainings and workshops.

It will likewise engage other education

stakeholders in the community by building sustainable partnerships with civil society, corporate sector, and local non-government organizations (NGOs). The grant will also allocate provision for project monitoring and evaluation.

ENERGY INNOVATION SERIES FEATURE #2: FUEL CELL TECHNOLOGY FROM BLOOM ENERGY Throughout 2012, EDF’s Energy Innovation Series will highlight more than 20 innovations across a broad range of energy categories, including smart grid and renewable energy technologies, energy efficiency financing, and progressive utilities, to name a few. This series will demonstrate that cost-effective, clean energy solutions are available now and imperative to lowering our dependence

their daily operations. These problems prompted Ahura Group’s Genera Manager, Steve Anstey, and Group Engineer, Jason Philp, to look into alternative power solutions.

Jason, having previously encountered exceptional Cummins power equipment and services during his time at the Bedarra Island Resort, made a recommendation based on his experience and

the Cummins Power Generation team was subsequently contacted.

Upon completing a thorough site inspection, the project team from Cummins Brisbane, with Jeff Evans as the Project Manager and Grant McWhinnie as the Application Engineer, worked closely with the Ahura Resorts team to design a new cost-effective power station that would counter

on fossil fuels.

For more information on this featured innovation, please view this video on Bloom Energy’s fuel cell technology.

California-based Bloom Energy is developing a different approach to power generation that has already had a profound impact on the way electricity is produced around the world.

Bloom Energy’s technology relies on fuel cells, which use an electrochemical process in which oxygen and fuel (natural gas or biogas) react to produce small amounts of electricity. When these fuel cells are stacked upon each other and arranged into large modules called Bloom Energy Servers™ or “Boxes,” they produce up to 200 kW of on-site power. This is enough power to meet the baseload needs of the average office building or 160 average homes.

Furthermore, this approach has the potential to reduce customers’ CO2 emissions by “40%-100% compared to the U.S. grid (depending on their fuel choice) and virtually eliminate all SOx, NOx, and other harmful smog forming particulate emissions.” It also enables the possibility of affordable on-site, userowned power generation that is as constant and reliable as a utility and provides an attractive economic payback for customers.

This kind of technology is a win-win economically and environmentally; one from which all sectors stand to benefit. The Bloom Energy Server also makes the micro-generation concept feasible. Imagine subdivisions, apartment complexes or neighborhoods with their own carbon-free (if powered by renewables), mini power plants.

their power issues. The team opted to install a prime power system that comprised three C250D5B generator sets and a DMC200 Digital Master Controller in order to solve Likuliku’s power problems.

Typically, only two of the three CD250D5B generators installed will run to provide support for the higher peak daytime load, which automatically reduces to a single set during off-peak hours. The

third generator automatically kicks in during standby, successfully creating an overall system where no single unit is burdened with excessive usage. Each genset also comes with an oil reserve that extends service intervals from 250 to 500 hours, minimizing potential downtimes.

The Cummins DMC200 Digital Master Controller provides automatic logic control that determines the best

machine combination with minimized fuel consumption.

The intelligent logic program controls the rotation of the gensets, starting an alternate machine when one becomes due for servicing.

Not only was the replacement power system up and running within the planned schedule, the Cummins team was also highly professional in their service and went out their way to provide extensive after-

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NEWS DESK GAIL EYES PROJECT STAKES, LONG-TERM DEALS The government owned gas utility GAIL India Ltd is evaluating several proposals for equity stakes and long-term supply deals in the United States, Middle East and Southeast Asia, its chairman said on Saturday.

The company’s strategy is part of the country’s efforts to secure overseas energy supplies to satisfy rising domestic demand.

Gail signed a deal with U.S.-based Cheniere Energy in December to buy 3.5 million tonnes of LNG a year under a 20-year contract starting from 2017.

It has been in talks with Macquarie Energy, which has a share in the U.S.-based Freeport LNG project, and last year, agreed to buy a 20-percent stake in one of Carrizo Oil & Gas Inc’s U.S. shale gas assets for $300 million.

“There are many proposals we are discussing,” GAIL Chairman B.C. Tripathi told Reuters in an interview, adding these included projects in the United States, Middle East and Southeast Asia, but declining to give details.

“It is difficult to give a timeframe because we have to settle on a price. In the Indian market there is a big appetite for gas, but it is all price sensitive,” he said.

On Friday, a consortium of GAIL and state-run oil producer Oil and Natural Gas Corp said it was still not out of the race for Africa-focused gas explorer Cove Energy Plc. “We have support of government to look for the larger energy security of the country and look for gas supplies, whether it is through buying equity, or through long-term contracts,” Tripathi said.

India, Asia’s third-largest economy, is already the world’s eighth-largest importer of liquefied natural gas (LNG).

Those imports could rise five-fold in the next decade as its domestic gas output falls and demand surges.

Problems at the D6 block off India’s east coast, operated by Reliance Industries, have curtailed output while ONGC is struggling to arrest declining production from its ageing fields, forcing up imports of expensive LNG. India needs gas to help power its electricity generation, fertiliser sector, city gas distribution and for its expanding industries.

NO SHARE BUYBACK GAIL, which is gradually stepping up from its primarily gas transmission portfolio to emerge as a major petrochemicals and LNG player in the local market, is looking to spend 300 billion rupees on capacity expansions over the next four years, Tripathi said.

India allowed cash-rich state companies to buy

back shares and acquire stakes in other state firms earlier this month, intended to help the government’s faltering divestment plan and narrow its widening fiscal deficit.

Tripathi, however ruled out any share buyback

by GAIL.“GAIL doesn’t have the option to invest in buybacks because we have a huge capex plan and we are investing in projects to build prospective capacity for the country,” he said.

“There is no appetite for GAIL to buy back.”

GAIL plans to boost its petrochemicals capacity in the next three years, increase gas transmission capacity by 50 percent and commission a new LNG terminal at Dabhol on India’s western coast in the coming months.

It is aiming to grow revenue at 20 to 25 percent for the next few years, Tripathi said.

The company plans to raise nearly half of its capex requirements through debt. It is looking for further borrowings from the international market through external commercial borrowings and export credit agencies.

It plans to raise around $100 million through a bond issue in the next few months, he said.

GAIL also said it is evaluating options for its 8 percent stake in Chinese gas utility China Gas Holdings, which is at the centre of an unsolicited $2.2 billion bid from China Petroleum & Chemical Corp (Sinopec) and ENN Energy Holdings.

GAIL, which acquired the stake in 2005, has not yet taken a final decision on the matter, Tripathi said.

“There is no offer as such, but we have received some information. Depending on what kind of options are available with us and how it pans out, we will take a decision,” he said.

Shares in GAIL, which has a market value of $9.1 billion, closed up 2.2 percent on Friday in Mumbai.

The stock is down 4 percent this year, lagging a 12 percent rise in the main stock index.

JAPAN DOWN TO ONE NUCLEAR REACTOR AFTER SHUTDOWN Workers making preparations inside the control room to restart the Monju Prototype Fast Breeder Reactor in Tsuruga, Fukui prefecture, west of Tokyo, in 2010. Japan has been left with only one working nuclear reactor after Tokyo Electric Power Co. shuttered its final generator for scheduled safety checks.

Japan was Monday left with only one working nuclear reactor after Tokyo Electric Power Co. shuttered its final generator for scheduled safety checks.

The vast utility’s entire stock of 17 reactors are now idle, including three units that suffered a meltdown when the tsunami hit Fukushima, as Japan warily eyes a spike in electricity demand over the hot and humid summer.

Only one of Japan’s 54 units -- in northernmost Hokkaido -- is still working, and that is scheduled to be shut down for maintenance work in May. The No. 6 unit at Tokyo Electric Power Co. (TEPCO)’s Kashiwazaki-Kariwa plant “stopped generating electricity at 23:59 Sunday, and its reactor was suspended at 1:46 Monday,” TEPCO spokesman Osamu Yokokura told AFP. The No. 6 unit is expected to undergo checks for several months, “but it depends on the result of checks and if we find some defects it may take

COMPANY NEWS FROM AROUND THE WORLD sales monitoring and support even after the power system had been installed and was running, which resulted in Steve Anstey having nothing but praise for Jeff, Grant and the entire Cummins project team.

“The new power station is probably the most seamless thing we’ve done here… its

installation has been effortless,” remarked Anstey.

“Everyone out there wants to sell you equipment but not everyone is prepared to provide the technical and after-sales support.”

With the reliable power support that Cummins Power Generation brings to the Likuliku Lagoon Resort, the

island paradise will continue to calmly weave its magic and captivate its guests in the years to come.

J-Series gas turbine

Mitsubishi Heavy Industries, Ltd. (MHI) has received a series of orders for its state-ofthe-art “M501J” gas turbines, ten units in total, for instal-

lation at four power plants in Korea. The plants are large-scale natural-gas-fired gas turbine combined-cycle (GTCC) power generation facilities with generation capacities ranging from near 950 to 1,900 megawatts (MW).

MHI’s J-Series gas turbines have achieved the world’s highest level of thermal effi-

ciency and the highest output.

MHI believes this outstanding performance was highly evaluated by the customers, leading to its winning of the multiple orders.

The ten gas turbines on order consist of two units each for the Yulchon 2, 2nd-Pyeongtaek and Ulsan 4 power plants and four units for the

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LESSONS IN RENEWABLE ENERGY AT AMERICA’S GREENEST HOTEL

more time to fix them,” Yokokura said.

Japan’s nuclear power industry lost public confidence when last March’s tsunami knocked out cooling systems at TEPCO-operated Fukushima, sending three reactors into meltdowns.

Radiation was spread over a wide area, forcing tens of thousands of people from their homes and rendering farmland useless in the world’s worst nuclear accident for a quarter of a century.

Map of Japan locating its 54 nuclear reactors, in which only one is still working and is scheduled to be shutdown for maintenance work in May Reactors idled for tests must get the consent of host communities before being re-started, something many of those living near nuclear power plants are now unwilling to give, leaving power companies no choice but to rely more heavily on fossil fuels.

In addition to the consent of host communities, utilities have to pass stress tests conducted by the government’s Nuclear and Industrial Safety Agency and get the green light from another government safety commission.

Japan’s minister of economy, trade and industry Yukio Edano has said the government will not introduce a summer cap on the use of electricity nor the rolling blackouts that were carried out last year after the nuclear accident. advertisement “We are expected to secure a stable supply of electric power for the time being,” TEPCO president Toshio Nishizawa said in a statement on Sunday.

Dongducheon power plant. All of these GTCC plants, which will have a collective power generation capacity reaching near 4,750 MW, are to be newly constructed.

Yulchon 2 is a near 950 MW power plant being built in Jeollanam-do by MPC Yulchon Generation Co., Ltd., a group company of Meiya Power

One hotel in the US as an example for renewable energy students to study. The hotel has achieved a 40 percent reduction in energy costs compared with other hotels of the same size, uses 30 percent less water, and has recovered 100 percent of its energy efficiency investment costs in less than two years.

Many of us in the renewable energy business began our careers elsewhere – as architects, builders, engineers, researchers, and investors who recognized opportunities for growth in the renewable energy field and wanted to get in on the ground floor. Others began as entrepreneurs, tinkering in their basements or garages on Sunday afternoons. Our education was on-the-job, not in the classroom. But now that the field is more firmly established, formal education in renewable energy is sorely needed.

Colleges and universities are beginning to meet this challenge by incorporating renewable energy coursework into their curricula and degree programs, and several MBA schools have even developed a renewable energy specialization. There are also many related programs at community colleges and trade schools, including courses covering green building design and photovoltaic panel installation.

Businesses are getting involved too, by sponsoring student internships and by sharing their expertise with local educational institutions. As a professor at a major US research university, my students and I recently had the opportunity to visit one such business, the Proximity Hotel in Greensboro, North Carolina.

Company Limited (MPC).

MPC is an independent power producer (IPP) based in Hong Kong. MHI received an order for two gas turbines, a steam turbine, two heat recovery steam generators and three generators.

The 2nd-Pyeongtaek, also a near 950 MW power plant, is being built in Gyeonggi-do

by Korea Western Power Co., Ltd. (KOWEPO), a subsidiary of Korea Electric Power Corporation (KEPCO). MHI has received an order, jointly with Marubeni Corporation, for two gas turbines, a steam turbine and generators.

For the near 1,900 MW Dongducheon power plant, MHI received an order,

The Proximity is possibly the greenest hotel in the US, if not the world. It was the first US hotel to earn the Leadership in Energy and Environmental Design organization’s highest Platinum rating, and its accomplishments are impressive: a 40 percent reduction in energy costs compared with other hotels of the same size, 30 percent less water use, and 100 percent recovery of its energy efficiency investment costs in less than two years. (In just the first year, the 7,000 USD spent on water saving products during construction was more than offset by a 13,000 USD reduction in water utility costs.)

Convinced that a green hotel could be both comfortable and profitable, the developers included a wide range of innovative design features and state-of-the-art technologies. (See a detailed list by clicking here.) Impressed by the hotel’s accomplishments, President Obama selected the Proximity as his home base during a recent visit to central North Carolina.

The technology in use at the hotel is impressive, but there were other, more important, lessons for my students. Perhaps the most important lesson was that running a green business isn’t just about protecting the environment and preserving our natural resources; being green also makes good business sense. In this regard, the hotel is a huge success, with a steady stream of guests, weddings, business meetings, and other events.

Another important lesson for my students was that green, energy-efficient buildings can also be eminently comfortable, thanks to their big windows, natural lighting, and fresh air. Also, many clients feel good about frequenting a business that puts a premium on environmental stewardship.

Businesses like the Proximity have been reaching out to their communities, helping educate students and the public about renewable energy and green buildings. The visionaries who conceived of the Proximity’s business model got it just right – green is not only good for the environment, it’s good business too!

also jointly with Marubeni, consisting of four gas turbines, two steam turbines and generators. Dongducheon Dream Power Co., Ltd., an IPP jointly established by KOWEPO, Samsung C&T Corporation and Hyundai Development Company, is building the POWER INSIDER MARCH/APRIL 2012 9

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NEWS DESK DIRECT INCENTIVES FOR SMART ENERGY AND SUSTAINABILITY PROJECTS Implementing actions to be more sustainable or to “go green” are shown to be economically beneficial in a number of ways (see my article on the 9 Purely Business Reasons to Go Green).

One thing that holds back many companies from these programs, however, is the upfront costs.

Although a smart sustainability program will make back that initial investment and more over time, some companies are hard-pressed in these tough times to find the funds available to make the initial investment. Fortunately, there are a growing number of governmental and non-governmental funds which will pay part or even all of the upfront costs of some of these sustainability ideas. Some of these programs are in the form of income tax deductions or credits, exemption from sales tax, or accelerated depreciation. Some are direct grants or low-interest loans. It is possible that your company qualifies for a number of these programs. In some cases, the credits or grant derive from funds that you have contributed to already (i.e., taxes or a charge within your local utility bill). Therefore, you may be getting back your money. So there is no reason not to pursue multiple incentives if you qualify for activities that will further benefit your company.

But don’t wait, as some expire. Sustainability and Energy Incentive Programs What types of activities are covered by incentives? They can include lighting upgrades; upgrading your boilers or converting to cogeneration; adding more insulation; installing alternative energy sources; using recycled products in your manufacturing; and installation of equipment to reduce air emissions or wastewater discharges. Among the federal programs is the IRS’s Energy Policy Act (EPAct) of 2005, which provides federal income tax deductions of up to $1.80 per square foot for upgrades of lighting, building envelope, and HVAC. A building owner must demonstrate actions that lead to performance reductions of 50% below a typical energy profile of a building that meets ASHRAE 90.1-2001 standards for the climate zone. EPAct is scheduled to expire on December 31, 2013. There are also tax credits for installing solar energy (PV). There are a wide variety of incentive programs offered by state and local governments. Thorough research into what is available is important. Not all states offer programs. Many states offer tax benefits, such as credits or treatment of equipment as an expense (and not dealing with depreciation).

Many state programs provide direct grant money to a company for investing in an energy upgrade.

The company still has to front the funds for the upgrade, but they know that if the installation is successful they will receive a percentage of the investment or a lump sum. It is critical to totally understand the program and what is expected to qualify. Forms need to be completed. In addition, it is preferable to hold meetings to ensure that the expectations of all sides are understood. Some states offer tax credits and/or sales tax exemptions for the purchase of certain equipment containing a high content of recycled materials. Some offer credits for purchasing advanced pollution control equipment. Some states offer incentives in the form of tax credits or direct grants for brownfield remediation and development. Such activities, however, must be overseen and approved by the USEPA and/or the state agency. There are also private companies or NGOs that offer incentive programs, as well. One growing example is that several energy service companies (ESCOs) offer to pay the entire upfront, capital cost of a solar system for your roof (if it qualifies) and maintenance and will supply your building the electricity you need at a discounted price to enable them to sell back electricity to the utility or to others. Preparing for Incentives It cannot be stressed enough that to take full advantage of available incentives one must plan your projects to meet their requirements. Planning is the key and more likely to succeed compared to “shoehorning” an unplanned project into a program. Be sure you understand the requirements

of an incentive program by reading the literature and, if necessary, meet with representatives to ensure a full understanding on both sides. Given the complexities of some of these programs, it is important to involve your Legal and Financial Departments in these reviews and discussions, as well. A joint understanding and joint decision are necessary to gain maximum benefits. Final Thoughts Remember, the best laid plans for energy or other environmental programs do not always succeed. Despite planning, you may not reach that 50% reduction goal of energy reduction necessary to qualify for the EPAct program incentive. Be prepared that you may not receive full benefits. In the UNFCCC CDM program of greenhouse gas (GHG) reductions, 30% of projects do not meet their GHG emission reduction goals. Remember, even an “unsuccessful” project that does not qualify for full incentives will still achieve bottom line financial benefits for a company. But do manage expectations. Finally, in evaluating the costs of a project, remember to focus on the requirements of the incentive programs. Many require intensive paperwork, as well as monitoring and other “proof” that goals are met. In some cases, goals must be maintained in the longer term, too. Make sure that your calculations of expenditures include long-term recordkeeping and reporting of key data. But the incentives are there and there is great opportunity for “free”, outside money to perform sustainability and energy projects that will provide long-term benefits you’re your company. CCES can assist you in evaluating programs to benefit you.

COMPANY NEWS FROM AROUND THE WORLD plant in Gyeonggi-do. It will deliver the core components to Samsung C&T and Hyundai Development.

For the near 950 MW Ulsan 4 power plant operated

by Korea East-West Power Company, a subsidiary of KEPCO, in Ulsan Metropolitan City, MHI received

an order jointly with Daelim Industrial Co, Ltd. for two gas turbines, a steam turbine and generators.

For each of the four orders received, MHI will supply the gas and steam turbines and Mitsubishi Electric will provide the generators.

The 60 hertz (Hz) M501J

gas turbine was developed in the spring of 2009 incorporating MHI’s proprietary technologies. It has realized the world’s highest efficiency and power generation capacity in a system of this type, having achieved the world’s highest turbine inlet temperature of 1,600 degrees Celsius (°C).

MHI has already received an order for six units from Kansai Electric Power Co., Inc. and delivered the first unit last December to its Himeji No.2 Power Station currently under construction. The six units will sequentially go onstream from 2013. The order from Korea marks the first for

the J-Series gas turbine from overseas. The turbines to be delivered to Korea are slated to begin GTCC operation sequentially beginning in 2014.

India’s onshore wind potential re-assessed: Up to 3000 GW instead of 100 GW Further countries should re-

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SITUATION ON KOREAN PENINSULA, NUCLEAR SECURITY FEATURE IN BAN’S TALKS IN SEOUL

Secretary-General Ban Ki-moon and the President of the Republic of Korea (ROK), Lee Myung-bak, held talks in Seoul today, focusing on issues such as the situation on the Korean peninsula, global nuclear security and the crisis in Syria.

Mr. Ban, who is currently on an official visit to his native ROK, reiterated serious concern about the announcement earlier this month of the Democratic People’s Republic of Korea (DPRK) to launch a so-called “application satellite” next month, according to information released by the Secretary-General’s spokesperson.

He renewed his call on the DPRK to fully comply with relevant Security Council resolutions, particularly resolution 1874 of 2009 which bans “any launch using ballistic missile technology.”

He also urged Pyongyang to reconsider its decision in line with its recent undertaking to refrain from long-range missile launches.

The Secretary-General shared the deep concern of the ROK Government about dislocated people from the DPRK, and encouraged the concerned parties to do their utmost to find a mutually agreeable solution.

He also congratulated Seoul on hosting the two-day Nuclear Security Summit that will begin on Monday and draw a number of world leaders. He commended the leadership role of Mr. Lee in advancing the international community’s efforts to prevent nuclear terrorism and strengthen the global nuclear security and safety regime.

The two leaders also discussed the country’s contribution to peacekeeping and the ongoing crisis in Syria, with Mr. Ban briefing the President on Joint Special Envoy Kofi Annan’s efforts to secure an end to violence and to gain unhindered humanitarian access.

assess and update their wind potential data Bonn/New Delhi, 26 March 2012 (WWEA) – Scientific and research work carried out by Indian wind industry expert Jami Hossain has inspired scientists at Lawrence Berkley National Laboratory (LBNL) to challenge assessments of the Chennai based government agency, Center for Wind Energy Technology

(CWET), on the potential for windfarms in India.

Jami Hossain in his paper, published in the international renewable energy journal Renewable Energy [1], presented his findings on the assessment for potential for windfarms using Geographical Information System Platform (GIS Platform). In this paper, Hossain pointed out that the potential for wind energy

utilization with the prevalent technologies is far in excess of the potential claimed to have been assessed by CWET (initially at 49’000 MW and later at 102’000 MW) [2]. Hossain assessed the potential at around 2000 GW, which has now been confirmed by the LBNL study which sees the total onshore wind potential of India between 2000 and 3000 GW.

Based on Hossain’s work, scientists at LBNL [3] have re-looked at the potential assessment under a project sponsorship

by ClimateWorks Foundation through a contract with the Regulatory Assistance Project. LBNL has come up with a report “Reassessing Wind Potential Estimates for India: Economic and Policy Implications”. The report re-

validates assessment made by Hossain earlier.

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CHINA OVERVIEW

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CHINA: ‘FEEDING THE ENERGY DRAGON’

BY CHARLIE FOX

CHINA IS THE WORLD’S MOST POPULOUS COUNTRY AND HAS A RAPIDLY GROWING ECONOMY, WHICH HAS CONTRIBUTED TO HIGHER OVERALL ENERGY DEMAND IN CHINA. CHINA’S REAL GROSS DOMESTIC PRODUCT (GDP) GREW AT AN ESTIMATED 10 PERCENT IN 2010, AFTER REGISTERING AN AVERAGE GROWTH RATE OF 10 PERCENT BETWEEN 2000 AND 2009, ACCORDING TO THE INTERNATIONAL MONETARY FUND.

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CHINA OVERVIEW

C

hina is the world’s second largest oil consumer behind the United States, and the largest global energy consumer, according to the International Energy Agency (IEA).

China was a net oil exporter until the early 1990s and became the world’s second largest net importer of oil in 2009. China’s oil consumption growth accounted for over a third of the world’s oil consumption growth in 2010. Natural gas usage in China has also increased rapidly in recent years, and China has looked to raise natural gas imports via pipeline and liquefied natural gas (LNG). China is also the world’s largest producer and consumer of coal, accounting for almost half of the world’s coal consumption, an important factor in world energyrelated CO2 emissions.

Coal supplied the vast majority (71 percent) of China’s total energy consumption of 85 quadrillion British thermal units (Btu) in 2008. Oil is the second-largest source, accounting for 19 percent of the country’s total energy consumption. While China has made an effort to diversify its energy supplies, hydroelectric sources (6 percent), natural gas (3 percent), nuclear power (1 percent), and other renewables (0.2 percent) account for relatively small shares of China’s energy consumption mix. EIA projects coal’s share of the total energy mix to fall to 62 percent by 2035 due to anticipated increased efficiencies and China’s goal to reduce its carbon intensity (carbon emissions per unit of GDP).

However, absolute coal consumption is expected to double over this period, reflecting the large growth in total energy consumption.

According to Oil & Gas Journal (OGJ), China had 20.4 billion barrels of proven oil reserves as of January 2011, up over 4 billion barrels from two years ago. China’s largest and oldest oil fields are located in the northeast region of the country. China produced an estimated 4.3 million bbl/d of total oil liquids in 2010, of which 96 percent was crude oil. China’s oil production is forecast to rise by about 290 thousand bbl/d to over 4.5 million bbl/d in 2012.

China consumed an estimated 9.2 million barrels

per day (bbl/d) of oil in 2010, up nearly 900 thousand bbl/d, or over 10 percent from year-earlier levels.

China’s net oil imports reached about 4.8 million bbl/d in 2010 and it became the second-largest net oil importer in the world behind the United States in 2009. EIA forecasts that China’s oil consumption will continue to grow during 2011 and 2012, and the anticipated growth of 1.1 million bbl/d between 2010 and 2012 would represent almost 40 percent of projected world oil demand growth during the 2-year period.

SECTOR ORGANIZATION ENERGY POLICY The Chinese government’s energy policies are dominated by the country’s growing demand for oil and its reliance on oil imports. The National Development and Reform Commission (NDRC) is the primary policymaking and regulatory authority in the energy sector, while four other ministries oversee various components of the country’s oil policy. The government launched the National Energy Administration (NEA) in July 2008 in order to act as the key energy regulator for the country.

The NEA, linked with the NDRC, is charged with approving new energy projects in China, setting domestic wholesale energy prices, and implementing the central government’s energy policies, among other duties. The NDRC is a department of China’s State Council, the highest organ of executive power in the country. In January 2010, the government formed a National Energy Commission with the

purpose of consolidating energy policy among the various agencies under the State Council.

NATIONAL OIL COMPANIES China’s national oil companies (NOCs) wield a significant amount of influence in China’s oil sector.

Between 1994 and 1998, the Chinese government reorganized most state-owned oil and gas assets into two vertically integrated firms: the China National Petroleum Corporation (CNPC) and the China Petroleum and Chemical Corporation (Sinopec). These two conglomerates operate a range of local subsidiaries, and together dominate China’s upstream and downstream oil markets. CNPC is the leading upstream player in China and, along with its publicly-listed arm PetroChina, account for roughly 60 percent and 80 percent of China’s total oil and gas output, respectively. CNPC’s current strategy is to integrate its sectors and capture more downstream market share. Sinopec, on the other hand, has traditionally focused on downstream activities, such as refining and distribution, with these sectors making up nearly 80 percent of the company’s revenues in recent years and is gradually seeking to acquire more upstream assets.

Additional state-owned oil firms have emerged over the last several years. The China National Offshore Oil Corporation (CNOOC), which is responsible for offshore oil exploration and production, has seen its role expand as a result of growing attention to offshore zones. Also, the company has proven to be a growing competitor to CNPC and Sinopec by not only increasing its exploration and production (E&P) expenditures in the South China Sea but also extending its reach into the downstream sector particularly in the southern Guangdong Province. The Sinochem Corporation and CITIC Group have also expanded their presence in China’s oil sector, although they are still relatively small.

Whereas onshore oil production in China is mostly limited to CNPC and CNOOC, international oil companies (IOCs) have been granted greater access to offshore oil prospects, mainly through production sharing agreements. IOCs involved in offshore E&P work in China include: Conoco Phillips, Shell, Chevron, BP, Husky, Anadarko, and Eni, among others. IOCs leverage their technical expertise in order to partner with a Chinese NOC and make a foray into the Chinese markets.

PRICING REFORM The Chinese government launched a fuel tax and reform of the country’s product pricing mechanism in December 2008 in order to tie retail oil product prices more closely to international crude oil markets, attract downstream investment, ensure profit margins for refiners, and reduce energy intensity caused by distortions in the market pricing. When international crude oil prices increased in 2010, the NDRC did not increase downstream fuel prices at the same level, causing refiners, especially NOCs to incur profit losses on the downstream business and increase exports to help offset the losses.

EXPLORATION & PRODUCTION China’s total oil production reached 4.3 million bbl/d in 2010, increasing 0.28 million bbl/d from 2009.

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CHINA OVERVIEW

This was primarily due to new offshore production growth. CNPC’s Daqing field, located in the Northeast, produced about 797,000 bbl/d of crude oil in 2010, according to FACTS Global Energy’s most recent estimate. Sinopec’s Shengli oil field in the Bohai Bay produced about 547,000 bbl/d of crude oil during 2010, making it China’s second-largest oil field. However, Daqing, Shengli, and other ageing fields have been heavily tapped since the 1960s, and output is expected to decline significantly in the coming years. Recent exploration and production (E&P) activity has focused on the offshore areas of Bohai Bay and the South China Sea (SCS), as well as onshore oil and natural gas fields in western interior provinces such as Xinjiang, Sichuan, Gansu, and Inner Mongolia.

ONSHORE Roughly 85 percent of Chinese oil production capacity is located onshore, primarily in mature fields. Although offshore E&P activities have increased substantially in recent years, China’s interior provinces, particularly in the northwest’s Xinjiang Province, have also received significant attention. Recently, China announced its plan to make Xinjiang into the country’s largest oil and gas production and storage base.

The onshore Junggar, Turpan-Hami, and Ordos Basins have all been the site of increasing E&P

work, although the Tarim Basin in northwestern China’s Xinjiang Uygur Autonomous Region has been the main focus of new onshore oil prospects.

IHS estimated reserves to be 290 million barrels in 2009. Crude oil production from Tarim reached 111,000 bbl/d in 2010 according to FACTS Global Energy, and only 12 percent of the basin has been explored. PetroChina envisages boosting production in the Junggar Basin, one of Xinjiang’s oldest basins, from 250,000 bbl/d in 2008 to 328,000 bbl/d by 2015.

China’s NOCs are also investing to increase oil recovery rates at the country’s mature oil fields.

CNPC is increasingly utilizing associated natural gas supplies from the Daqing field for reinjection purposes to fuel enhanced oil recovery (EOR) projects. CNPC hopes that EOR techniques can help stabilize Daqing’s oil output in the years ahead. However, China’s domestic demand for natural gas supplies is also increasing, which may put a competing claim on natural gas supplies from Daqing. The map below delineates the location of some of the major Chinese oil basins.

OFFSHORE About 15 percent of overall Chinese oil production is from offshore reserves, and most of China’s oil production growth likely will come from offshore fields. Offshore E&P activities have focused on the Bohai Bay region, the South China Sea (particularly the Pearl River Basin), and, to a lesser extent, the East China Sea. The Bohai Bay Basin, located in northeastern China offshore Beijing, is the oldest oil-producing offshore zone and holds the bulk of proven offshore reserves in China. PetroChina initiated phase one development of the Nanpu field in June 2007, and hopes to bring 200,000 bbl/d of crude oil production on-stream by 2012. CNOOC intends to double oil production in the offshore Bohai Bay, where over half of the NOC’s production is expected to originate by 2015. The NOC made 8 new discoveries in the Bohai Bay in 2009 and brought several fields online including Jinhzhou and Bonzhong. CNOOC’s production in the Bohai Bay including volumes from the East China Sea was 317,000 bbl/d in 2009.

In 2009, CNOOC’s total oil production in the SCS was 191,000 bbl/d. According to PFC Energy, CNOOC’s proven hydrocarbon (oil and gas) reserves in 2009 in the SCS were 957 million barrels of oil equivalent, up 28 percent from a decade ago. CNOOC and ConocoPhillips are developing the Panyu oilfields with output peaking at 60,000 bbl/d. In 2010, CNOOC made another significant discovery of the Enping Trough in the shallow waters of the SCS, which could generate up to 30,000 bbl/d. CNOOC tendered 13 blocks in May 2010 in the South China Sea. TERRITORIAL DISPUTES Territorial disputes in the East China Sea have so far limited large-scale development of fields

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in the region, where China and Japan’s Exclusive Economic Zones (EEZs). The two countries have held negotiations to resolve the disputes. In June 2008, the two countries reached an agreement to jointly develop the Chunxiao/Shirakaba and Longjing/Asurao fields. However, in early 2009, the agreement unraveled when China asserted sovereignty over the fields. Tensions in the second half of 2010 have surfaced between the two countries over the gas fields.

China claims ownership of the potentially hydrocarbon rich Spratly Islands in the South China Sea, as do the Philippines, Malaysia, Taiwan, and Vietnam. In June 2007, BP abandoned plans to conduct exploration activities near the Spratly Islands, citing ongoing uncertainty over competing ownership claims between China and Vietnam. The Paracel Islands, which China first occupied in 1974, are also claimed by Vietnam.

OVERSEAS ACQUISITIONS China’s overseas equity oil production grew significantly this decade from 140,000 bbl/d in 2000 to 1.2 million bbl/d in 2009. With China’s increasing dependence on oil imports and the need for diversification of energy supply sources, Chinese NOCs have sought interests in projects overseas.

CNPC has been the most active company, while Sinopec, CNOOC, and other smaller NOCs have also expanded their overseas investment profile.

CNPC held hydrocarbon assets in 29 countries by the end of 2010 and 684,000 bbl/d of overseas oil equity production. China is taking advantage of the economic downturn and lower asset values to step up its global acquisitions. Since 2009, the NOCs have purchased assets in the Middle East, Canada, and Latin America, with about $28 billion invested for direct acquisition of oil and gas assets from other companies. Chinese NOCs have secured bilateral

oil-for-loan deals amounting to over $90 billion with several countries. CNPC plans to expand overseas production to 4 million bbl/d by 2020.

China can use its vast foreign exchange reserves, estimated at $2 trillion, to help leverage investments.

China finalized oil-for-loan deals recently with Russia, Kazakhstan, Venezuela, Brazil, Ecuador, Bolivia, Angola, and Ghana and a gas-for-loan agreement with Turkmenistan.

OIL IMPORTS The Middle East remains the largest source of China’s crude oil imports, although African countries also contribute a significant amount. China imported nearly 4.8 million bbl/d of crude oil in 2010, of which over 2.2 million bbl/d (47 percent) came from the Middle East, 1.5 million bbl/d (30 percent) from Africa, 176,000 bbl/d (4 percent) from the AsiaPacific region, and 938,000 bbl/d (20 percent) came from other countries. In 2010, Saudi Arabia and Angola were China’s two largest sources of oil imports, together accounting for over one-third of China’s total crude oil imports. Crude oil imports rose over 17 percent from 4.1 million bbl/d in 2009.

Angola has become as significant an exporter of crude to China as Saudi Arabia and in some months has been the largest supplier. The EIA expects China

to import about 72 percent of its crude oil by 2035, a significant rise from the current 50 percent.

PIPELINES China has actively sought to improve the integration of the country’s domestic oil pipeline network, as well as to establish international oil pipeline connections with neighboring countries to diversify oil import routes. In March 2007, CNPC spearheaded the Beijing Oil & Gas Pipeline Control Center that monitors all long-distance pipelines.

DOMESTIC SYSTEM According to the CNPC, China has about 13,932 miles of total crude oil pipelines (70 percent managed

by CNPC) and nearly 8,265 miles of oil products pipelines in its domestic network. At present, the bulk of China’s oil pipeline infrastructure serves the more industrialized coastal markets. However, several long-distance pipeline links have been built or are under construction to deliver oil supplies from newer oil-producing regions or from downstream centers to more remote markets.

The 1,150-mile Western China Refined Oil Pipeline delivers petroleum products from Urumqi in Xinjiang Province to Lanzhou in Gansu Province.

Gradually, this pipeline will connect with other regional spurs to deliver supplies to the coastal regions, as well as accommodate additional oil imports from Kazakhstan. Previously, most oil supplies from Xinjiang were delivered by rail. In addition, the Western Pipeline consists of a crude oil line travelling from Xinjiang to the Lanzhou refinery.

CNPC has commissioned various oil product pipelines. The company launched the LanzhouChengdu-Chongqing pipeline in 2008 and the 300,000 bbl/d Lanzhou-Zhengzhou-Changsha pipeline in 2009. PetroChina also has plans to build at least two additional spurs from Zhengzhou, POWER INSIDER MARCH/APRIL 2012 17

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CHINA OVERVIEW which would help deliver crude oil supplies eastward.

One is the Zhengzhou-Jinzhou pipeline, which would deliver oil northeastward to Hubei Province.

The other is the Zhengzhou-Changsha link, which would terminate in Hunan Province near the industrial southeast.

INTERNATIONAL CONNECTIONS China inaugurated its first transnational oil pipeline in May 2006, when it began receiving Kazakh and Russian oil from a pipeline originating in Kazakhstan. The 200,000 bbl/d pipeline spans 620 miles, connecting Atasu in northern Kazakhstan with Alashankou on the Chinese border in Xinjiang.

The pipeline was developed by the Sino-Kazakh Pipeline Company, a joint venture between CNPC and Kazakhstan’s KazMunaiGaz (KMG). The pipeline’s third leg from Kenkiyak to Atasu and an expansion of the entire pipeline, doubling capacity to 400,000 bbl/d, are to be completed in 2011 by CNPC. Industry publications suggest that the Atasu to Alashankou line has been running at about 50 percent of capacity, or slightly over 100,000 bbl/d.

Russia’s Far East has become another source for Chinese crude oil imports. Russian state-owned oil giant Transneft began construction in April 2006 on a pipeline that will extend 2,972 miles, from the Russian city of Taishet to the Pacific Coast (see Russia Country Analysis Brief ). Known as the Eastern Siberia-Pacific Ocean Pipeline (ESPO), the project will be completed in two stages. The first stage of the project includes the construction of a 600,000 bbl/d pipeline from Taishet to Skovorodino. The first phase of ESPO, which became operational in January 2011, is scheduled to deliver 300,000 bbl/d to the Chinese border. Furthermore, CNPC intends to build a 597-mile pipeline linking the spur with the Daqing oil field in the Northeast.

China has also revived its plans to construct an oil import pipeline from Myanmar through an agreement signed in March 2009. As Myanmar is not a significant oil producer, the pipeline is envisioned as an alternative transport route for crude oil from

the Middle East and Africa that would bypass the potential choke point of the Strait of Malacca. Initial capacity for the pipeline is slated to be 244,000 bbl/d, ramping up to 400,000 bbl/d.

REFINING China is steadily increasing its oil refining capacity in order to meet robust demand growth. Most industry sources estimate China’s installed crude refining capacity at over 11 million bbl/d. China’s goal is to augment refining capacity by about 3.3 million bbl/d by 2015. A recent report by Sinopec stated that the national oil refining capacity would rise to 15 million bbl/d by 2016.

Sinopec and CNPC are the two dominant players in China’s oil refining sector, accounting for 50 percent and 35 percent of the capacity, respectively. However, CNOOC entered the downstream sector through the commission of the company’s first refinery, the 240,000 bbl/d Huizhou plant. Sinochem has also proposed a number of new refineries, and national oil companies from Kuwait, Saudi Arabia, Russia, Qatar, and Venezuela have also entered into joint-ventures with Chinese companies to build new refining facilities. The Chinese NOCs recently expanded their refining portfolios through commissioning two more refineries in 2010, Sinopec’s Tianjin and CNPC’s Quinzhou, each with a capacity of 200,000 bbl/d.

By 2010, China’s total refinery processing reached around 8.5 million bbl/d, up by 13 percent over the previous year.

PetroChina (CNPC) is branching out to acquire refinery stakes in other countries in

efforts to move downstream and secure more global trading and arbitrage opportunities.

The company ’s purchase of Singapore Petroleum Corporation and a portion of Japan’s Osaka refinery are cases where PetroChina is looking for a foothold within the region’s refining opportunities.

The refining sector has undergone modernization and consolidation in recent years, with dozens of small refineries (“teapots” and independent refiners), ranging from 40,000 bbl/d to 120,000 bbl/d and accounting for about 15 percent of total refinery capacity, shut down. The NDRC plans to eliminate refineries smaller than 20,000 bbl/d that are mostly owned by independent companies in efforts to encourage economies of scale and energy efficiency measures.

Domestic price regulations for finished petroleum products have hurt Chinese refiners, particularly small ones, in the past few years when oil prices were high. Lower domestic prices compared to international market prices for retail products provides incentives for Chinese refiners, especially those run by national companies, to export high volumes of products. In 2010, China imported approximately 700,000 bbl/d and exported 600,000 bbl/d of petroleum products including LPG, gasoline, diesel, jet fuel, fuel oil, and lubricants.

Exports of products are expected to remain high as refining capacity is added in 2011 and beyond.

As China diversifies its crude oil import sources and expands oil production domestically, stateowned refiners will have to adjust to the changing crude slate. Traditionally, many of China’s refineries were built to handle relatively light and sweet crude oils. In recent years, refiners have built or upgraded facilities to support greater Middle Eastern crude oil imports, which tend to be heavy and sour. Much of the country’s planned new oil production in the offshore Bohai Bay is considered high-acid, and China is the largest importer of Sudan’s Dar Blend, a high-acid crude. High-acid crude oil tends to be light and sweet, but refiners must install stainless steel metallurgy or utilize other advanced processes to successfully run the crude streams.

STRATEGIC OIL RESERVES In China’s 10th 5-Year Plan (2000-2005), launched in 2001, Chinese officials decided to establish a government-administered strategic oil reserve program to help shield China from potential oil supply disruptions. This system will be built in three stages, and in 2004, China started construction at four sites that would comprise the first phase of the country’s strategic oil reserve program. Phase 1 has a total storage capacity of 103 million barrels at four sites, and was completed in early 2009. Phase 1 storage capacity will amount to approximately 25 days of net oil imports based on 2008 estimates of Chinese oil demand. Thereafter, Phase 2, recently under construction for 8 sites, is expected to more than double capacity to 270 million barrels by 2012/13. Phase 3 is ultimately expected to bring total strategic oil reserve capacity in China to about 500 million barrels by 2016.

In addition to the strategic reserves of crude oil, China has approximately 300 million barrels of commercial crude oil storage capacity according

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Province, one of China’s most promising upstream assets. CNOOC led the development of China’s first three LNG import terminals at Shenzhen, Fujian, and Shanghai and manages much of the country’s offshore production. CNOOC typically uses PSC agreements with foreign companies wanting to co-develop upstream offshore projects and has the right to acquire up to a 51 percent working interest in all offshore discoveries once the IOC recovers its development costs.

PRICING China’s natural gas prices, similar to retail oil prices are regulated and generally well below international market rates. China has favored manufacturing and fertilizer gas users by the relatively lower price these sectors pay. In order to bolster investment in the sector, particularly by foreign participants, and make domestic gas competitive with other fuels, the NDRC proposed linking gas prices indirectly to international crude oil prices, effectively raising prices. Industry analysts claim these price modifications are necessary to develop the gas market further. In mid-2010, the NDRC raised the onshore wellhead prices by 25 percent, and some Chinese cities have raised enduser prices in the industrial and power sectors.

Exploration and Production China’s primary natural gas-producing regions are Sichuan Province in the southwest (Sichuan Basin); the Xinjiang Uygur Autonomous Region and Qinghai in the northwest (Tarim, Junggar, and Qaidam Basins); and Shanxi Province in the north (Ordos Basin), producing about 65 percent of China’s total gas output. Several offshore natural gas fields are located in the Bohai Basin and the Panyu complex in the South China Sea.

to some industry sources. The government reported that it also plans to create a strategic refined oil stockpile, to be operated by a subsidiary of NDRC, of 80 million barrels.

NATURAL GAS According to OGJ, China had 107 trillion cubic feet (Tcf ) of proven natural gas reserves as of January 2011, 27 Tcf higher than reserves estimated in 2009.

China’s production and demand for natural gas has risen substantially. In 2009, China produced 2.93 Tcf of natural gas, up around 8 percent from 2008, while the country consumed 3.08 Tcf. China became a net natural gas importer for the first time in almost two decades in 2007.

The Chinese government anticipates boosting the share of natural gas as part of total energy consumption to 10 percent by 2020 to alleviate high pollution from the country’s heavy coal use.

Consumption for 2009 rose from 2008 levels by over 12 percent, and the country imported over 140 Bcf of liquefied natural gas (LNG) to fill the gap. Although a majority of the gas consumption is dominated by industrial users (45 percent in 2007 according to the National Bureau of Statistics), the recent growth of gas consumption in the past few years stems from the power, utilities, and residential sectors. EIA projects

gas demand to more than triple by 2035, growing about 5 percent per year. To meet this anticipated shortfall, China is expected to continue importing natural gas via LNG and a number of potential import pipelines from neighboring countries.

SECTOR ORGANIZATION NATIONAL OIL COMPANIES As with oil, the natural gas sector is dominated by the three principal state-owned oil and gas companies: CNPC, Sinopec, and CNOOC. CNPC is the country’s largest natural gas company in both the upstream and downstream sectors. CNPC data shows that the company accounts for roughly 80 percent of China’s total natural gas output. Sinopec operates the Puguang natural gas field in Sichuan

SOUTHWEST The largest recent discoveries in the southwestern region are Sinopec’s find at the Yuanba and Puguang fields in Sichuan Province. Sinopec started commercial production at Puguang in early 2010 and anticipates the field peaking at 425 Bcf/y.

Sichuan Province also holds the high sulfur content fields at the Chuandongbei basin. In 2007, CNPC awarded a 30-year production sharing contract (PSC) to Chevron to bring this technically challenging field online by 2013, with an eventual maximum production rate of 558 Bcf/y.

NORTHWEST Xinjiang is currently China’s largest gas producing province, with output of 850 Bcf in 2009. According to IHS Global Insight, major fields in the Tarim Basin have proven gas reserves of nearly 20 Tcf, and only 12 percent of the basin has been explored thus far. However, the basin’s complex geological features and the distance from China’s main consumption centers make development costs relatively high.

PetroChina’s cross-country West-East Gas Pipeline, which spans 2,500 miles from the Xinjiang Uygur Autonomous Region to Shanghai, has greatly expanded the upstream potential of the TarimBasin to supply markets in eastern China. Tarim was the second largest gas-producing area in China in 2009, with 640 Bcf/y or 22 percent of China’s total production, and PetroChina endeavors to increase production in order to feed the first West to East POWER INSIDER MARCH/APRIL 2012 19

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CHINA OVERVIEW

pipeline. The NOC is currently developing the Kela2 field, China’s largest gas field, which feeds gas to the first West to East Pipeline and has a maximum production capacity of 400 Bcf/y. Other new discoveries in the Northwest that have high potential of gas supply are the Junggar Basin in Xinjiang Province and the Qaidam Basin in Qinghai Province.

NORTHEAST The Chanqing oil and gas province in the Ordos basin was one of the largest producing gas region in China in 2009. Development of this region is geologically and technically challenging, though production has risen steadily this decade to 670 Bcf/y in 2009.

PetroChina anticipates producing 1,230 Bcf/y in the region by 2015.

OFFSHORE Offshore zones have also received increasing attention for upstream natural gas developments in China. The South China Sea is home to the Yacheng 13-1 field, China’s largest offshore natural gas field and a primary source of energy for Hong Kong’s power stations. The Yacheng 13-1 field is operated

by BP (34 percent), with CNOOC (51 percent) and Kuwait Foreign Petroleum Exploration Company (15 percent), and produces about 124 Bcf/y of natural gas. The Panyu 30-1 field was brought on in 2009 and is expected to peak at 58 Bcf/y. Sinopec also began exploring deepwater wells in the Qiongdongnan Basin in 2009 and partnered with Statoil to leverage their technical expertise in deepwater drilling.

UNCONVENTIONAL GAS RESOURCES China’s potential wealth of unconventional gas resources such as coal bed methane (CBM) and shale gas has spurred the government to seek foreign investors with technical expertise to exploit these reserves. China is estimated to have 6 Tcf so far of proven reserves from CBM in 2010, though estimates for recoverable reserves are much higher.

Most of China’s CBM volumes are from the north and northeastern basins and the Junggar basin in

Xinjiang. FACTS Global Energy estimates that total CBM production in 2009 was 254 Bcf/y, and expects production to rise to 1,715 Bcf/d by 2030. Also, China’s first long distance CBM pipeline became operational in late 2009, linking the Qinshui Basin with the West-East pipeline.

Most of China’s shale gas resources reside in the Sichuan and Tarim basins in the southern and western regions and in the northeast basins. In early 2010, the Ministry of Land Resources set out its goals regarding shale gas: to produce 530 to 1,000 Bcf/y, accounting for 8 to 12 percent of China’s total natural gas from shale gas by 2020.

EIA estimates that China’s technically recoverable shale gas resources are 1,275 Tcf. China’s NOCs are in discussion with several IOCs for partnering on potential shale gas projects.

PIPELINES China had nearly 21,000 miles of natural gas pipelines with a capacity of 3.5 Tcf at the end of 2009. China’s natural gas pipeline network is fragmented, though the government is investing in integrating local gas distribution networks, and plans to construct 14,400 miles of new pipelines between 2009 and 2015. While the major NOCs operate the trunk pipelines, local transmission networks are operated by various local distribution companies throughout China. This has prevented the emergence of a national gas transmission grid. CNPC moved into the downstream gas sector recently through investments in gas retail projects in 14 provinces, as well as investments in several pipeline projects.

This will facilitate domestic gas transportation and increase gas imports for a growing market. Sinopec is also a major player in the downstream transmission sector, operating pipelines in the Sichuan province.

Recently, the NOC commissioned the 1,000 mile, 425 Bcf/y pipeline running across 8 provinces from its recently operating Puguang field to Shanghai.

WEST-EAST GAS PIPELINE PetroChina’s West-East Gas Pipeline, commissioned

in 2004, is China’s single-largest natural gas pipeline at 2,500 miles in length. The pipeline links major natural gas supply bases in western China (Tarim, Qaidam, and Ordos Basins) with markets in the eastern part of the country. The Chinese government promoted the construction of the West-East Gas Pipeline to supply natural gas consumption to the eastern and southern regions of the country. The West-East pipeline has an annual capacity of 424 Bcf/y, capable of expansion to 600 Bcf/y, and contains numerous regional spurs along the main route, which has improved the interconnectivity of China’s natural gas transport network.

CNPC is building a second West-to-East trunk pipeline with a potential capacity of 1.1 Tcf/y. The eastern section of the line would run from the Sino-Kazakh border to Guangzhou in Guangdong Province, spanning more than 4,000 miles, and is due to be operational by 2012. The western section of the line became operational at the end of 2009 and will serve the markets of Shanghai once the eastern section is complete.

In order to accommodate greater gas flows from Central Asia, CNPC released plans to construct the third West-East Pipeline to partially run parallel to the second West-East line and end in the southern province of Guizhou. Analysts anticipate that the 0.7 to 1 Tcf/y pipeline will offtake gas from Turkmenistan’s production and domestic output from the Junggar fields, though supply arrangements are still undefined. There have been proposals for a fourth and fifth West-East pipelines which are in pre-feasibility stages. The Tarim Basin is reportedly slated to feed gas to the fourth line.

CENTRAL ASIAN GAS PIPELINE (CAGP) AND INTERNATIONAL PIPELINES China’s first import natural gas pipeline was the Central Asian Gas Pipeline (CAGP), which spans 1,130 miles and bring natural gas imports to China from Turkmenistan, Uzbekistan, and Kazakhstan.

In December 2009, CNPC was awarded a PSC to develop natural gas resources at Turkmenistan’s

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large South Yolotan gas fields, and signed a deal with Turkmengaz, the state-owned gas company, to import natural gas supplies. The pipeline began operations in December 2009 with initial volumes at 200 Bcf/y, and links to the second West-East pipeline in China. Turkmenistan announced that it intends to raise the gas supply to at least 1.4 Tcf/y once the South Yolotan field development is complete in 2012.

In June 2010, CNPC signed an MOU with Uzbekistan to deliver over 350 Bcf/y through a transmission line that would connect with the CAGP. Kazakhstan and China also signed a joint venture agreement in June 2010 to jointly construct the second phase of the Kazakh-China gas pipeline, starting in western Kazakhstan and linking to the CAGP. Pipeline commissioning could begin in 2012.

There are several proposed pipelines that could contribute to Chinese natural gas imports in the future. tʪ *O .BSDI $/1$ PċDJBMT TJHOFE B Memorandum of Understanding with Russia’s Gazprom for two pipeline proposals, one from Russia’s western Kovykta gas field to northwestern China with a pipeline capacity between 1 and 1.4 Tcf/y by 2015. A second proposed route, called the Eastern pipeline, would connect Russia’s Far East and Sakhalin Island to northeastern China, and would have 1.1 to 1.4 Tcf/y capacity. tʪ$/1$ TJHOFE B EFBM XJUI .ZBONBS JO .BSDI 2009 to finance the construction of a 1,123-mile, 420 Bcf/y pipeline from two of Myanmar’s offshore blocks to Kunming, China. Construction began on the project, due to commence in 2013.

LIQUEFIED NATURAL GAS (LNG) China’s natural gas imports are primarily in the form of LNG. Re-gasification capacity was over 584 Bcf in 2010. China’s LNG imports are expected to rise as more terminal capacity comes online, though higher international LNG prices versus lower gas prices from domestic sources and Turkmenistan could cause more competition for LNG. China imported its first shipment of LNG in the summer 2006, and the country has quickly ramped

up imports since then, importing about 730 MMcf/d in 2009 and 1,200 MMcf/d in 2010. LNG now enters the country through three terminals, with another five under construction and more receiving government approvals. CNOOC is the key LNG player in China and operates all three existing plants.

Chinese NOCs must secure supply prior to gaining government approval to build a regasification terminal, and Chinese firms are faced with competition from other regional buyers, mainly in Korea and Japan. Therefore, CNOOC and PetroChina have signed several long terms supply contracts totaling about 3 Bcf/d. These contracts are primarily with Asian firms sourcing LNG from Indonesia, Malaysia, and Australia.

Several re-gasification terminals are in various phases of planning and construction. CNOOC is keenly interested in growing its LNG market as it has a competitive advantage thus far in the sector compared to the other NOCs. In addition, CNOOC received approval to build its planned Zhejiang plant from the NDRC in 2009, and intends to expand the company’s three existing terminals. PetroChina entered the LNG market and is currently building the Dalian, Jiangsu, and Tangshan re-gasification terminals.

COAL According to the World Energy Council, China held an estimated 114.5 billion short tons of recoverable coal reserves in 2009, the third-largest in the world behind the United States and Russia, and equivalent to about 14 percent of the world’s total reserves. Coal production rose to almost 3.4 billion short tons in 2009, making China the largest coal producer in the world. There are 27 provinces in China that produce coal, and slightly greater than half of China’s coal is used for power generation. Northern China, especially the Shanxi and Inner Mongolia Provinces, contains most of China’s easily accessible coal and virtually all of the large state-owned mines.

Coal makes up 71 percent of China’s total primary energy consumption, and in 2009, China consumed an estimated 3.5 billion short tons of coal, representing over 46 percent of the world total and a

180 percent increase since 2000. Coal consumption has been on the rise in China over the last nine years, reversing the decline seen from 1996 to 2000.

China’s coal imports started growing after 2002 because the cost of importing coal became competitive with domestic production. China, typically a net coal exporter, became a net coal importer in 2009, importing from Indonesia, Australia, Vietnam, and Russia. In September 2009, the China Coal Transportation and Distribution Association stated that China signed a $6 billion loan-for-coal agreement with Russia for 15 to 20 million tons of coal for 25 years.

China’s coal industry has traditionally been fragmented among large state-owned coal mines, local state-owned coal mines, and thousands of town and village coal mines. The top three stateowned coal companies produce less than 15 percent of the domestic coal. Shenhua Coal, the world’s largest coal company, holds 9 percent of the domestic market in China.

China has tens of thousands of small local coal mines where insufficient investment, outdated equipment, and poor safety records prevent the full utilization of coal resources. Though the smaller coal mines currently hold a sizeable portion of the market, they are inefficient and are ineffective in responding to market demand. The goal of consolidating the industry is to raise total coal output, attract greater investment and new coal technologies, and improve the safety and environmental record of coal mines. As part of China’s 12th Five-Year Plan, the government intends to consolidate the sector. The State Council also began promoting cross-business ventures and participation between power, industrial and coal companies in order to facilitate the coal sector consolidation process in 2009.

In contrast to the past, China is becoming increasingly open to foreign investment in the coal sector in an effort to modernize existing large-scale mines and introduce new technologies into China’s coal industry. The China National Coal Import and Export Corporation is the primary Chinese partner for foreign investors in the coal sector.

Areas of interest in foreign investment include coal liquefaction, CBM production, coal-to-gas and slurry pipeline transportation projects. The Chinese government is actively promoting the development of a large coal-to-liquids industry. A Shenhua Group subsidiary commissioned the country’s first coalto-liquids plant in 2009. The facility is located in the Inner Mongolia Autonomous Region and has an initial capacity of approximately 24,000 bbl/d of diesel, ramping up to 240,000 bbl/d by 2015. Shenhua Group and Sasol Limited began construction on a second CTL project, Ningxia CTL, in 2010, and expects to commission 80,000 bbl/d by 2017.

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CHINA OVERVIEW ELECTRICITY China had an estimated total installed electricity generating capacity of 797 gigawatts (GW) in 2008, and in 2009, net generation was 3,446 billion kilowatt-hours (Bkwh), 81 percent of which came from conventional thermal sources, mostly coal.

Installed capacity increased over 10 percent between 2007 and 2008 and is expected to grow in the next decade to meet rising demand particularly from demand centers in the East and South of the country.

FACTS Global Energy expects installed capacity will be over 1,000 GW by the end of 2011 and 1,600 GW by 2020. Both electricity generation and consumption have increased by over 110 percent since 2000. EIA predicts total net generation to increase to 10,555 Bkwh by 2035, over 3 times the amount in 2009.

Rapid growth in electricity demand this previous decade spurred significant amounts of investment in new power stations. Although much of the new investment was earmarked to alleviate electricity supply shortages, the economic crisis of late 2008 resulted in a lower demand for electricity. Some industry analysts forecast the possibility of oversupply as an assortment of new projects are scheduled to come online in the next few years, though power demand is already rebounding as the Chinese economy recovers.

The government is investing in further development of the transmission network, integration of regional networks, and bringing on planned new generating capacity. Investment in the transmission grid was greater than that in the generation sector for the first time in 2008.

SECTOR ORGANIZATION In 2002, the Chinese government dismantled the

monopoly State Power Corporation (SPC) into separate generation, transmission, and services units.

Since the reform, China’s electricity generation sector is dominated by five state-owned holding companies, namely China Huaneng Group, China Datang Group, China Huandian, Guodian Power, and China Power Investment. These five holding companies generate about half of China’s electricity.

Much of the remainder is generated by independent power producers (IPPs), often in partnership with the privately-listed arms of the state-owned companies.

Deregulation and other reforms have opened the electricity sector to foreign investment, although this has so far been limited.

During the 2002 reforms, SPC divested all of its electricity transmission and distribution assets into two new companies, the Southern Power Company and the State Power Grid Company. The government aims to merge SPC’s 12 regional grids into three large power grid networks, namely a northern and northwestern grid operated by State Power Grid Company and a southern grid operated by the

Southern Power Company by 2020. Also in 2002, the State Electricity Regulatory Commission (SERC) was established, which is responsible for the overall regulation of the electricity sector and improving investment and competition in order to alleviate power shortages.

Wholesale and retail electricity prices are determined and capped by the NDRC. The NDRC also determines a plan price that coal companies should sell to power producers for a certain level of supplies. Typically, generators negotiate directly with coal companies for long-term contracts. The NDRC made small changes to its pricing system, and in 2009, the agency allowed electricity producers and wholesale end-users such as industrial consumers to negotiate with each other directly. Also, China raised end-user prices for all sectors except the residential sector by $0.04/kwh in late 2009. The latest power tariff changes were from June 2010 when the government raised rates for energy intensive industries by 50 to 100 percent in order to achieve energy efficiency goals for the year.

CONVENTIONAL THERMAL Conventional thermal sources currently make up about 81 percent of power generation and over 77 percent of installed capacity. Hydrocarbons are expected to remain the dominant fuel in the power sector in the coming years, primarily coal and natural gas. In 2009, China generated about 2,803 Bkwh from fossil fuel sources. The Chinese government envisages thermal installed capacity will reach 1,000 GW by 2020, up from 652 GW in 2009, representing about two-thirds of the total capacity. EIA predicts a more conservative growth for capacity, reaching 812 GW by 2020 and 1,300 GW by 2035.

Because of the large amount of reserves, coal will continue to dominate the fuel feedstock for the power capacity and generation, even as other cleaner fuels increase market share. As with coal mining, the Chinese government is looking to shut down or modernize many small and inefficient power plants in favor of medium-sized (300 to 600 MW) and large (1000 MW and higher) units. The NEA announced that the government had met its annual target to remove 10 GW of coal-fired generation from small capacity generators in 2010 and that over 70 GW had been retired overall from 2006 to 2010. In following this trend, the NEA forecasts another 8 GW of coal generation will be removed in 2011.

Natural gas currently plays a small role in the power generation mix (currently 5 percent of installed capacity and 2 percent in net generation); however, the government plans to invest in more gasfired power plants as a growing marginal fuel source.

Gas prices declined in 2010, and China is able to source the fuel from growing domestic sources as well as growing import alternatives, though coal still remains the less expensive feedstock. There are several examples of China’s effort to bring new efficient gasfired units online, some in conjunction with new LNG terminals such as those in the Guangdong and Shanghai. Also, there are several coal-fired and oilfired power plants that are being converted to run on natural gas in Guangdong. In May 2010, Huaneng Power International, China’s largest listed electricity generation company, signed strategic agreements with CNOOC to explore opportunities for gas-

fired power projects in the coastal areas near regasification terminals.

HYDROELECTRIC AND RENEWABLES China has a goal to generate at least 15 percent of total energy output by 2020 using renewable energy sources as the government aims to shift to a less-resource intense economy. According to the consultancy EC Harris, in 2010, China is the world’s top investor in renewable energy projects, having invested around $120 billion to $160 billion between 2007 and 2010.

China was the world’s largest producer of hydroelectric power in 2009, generating 549 Bkwh of electricity from hydroelectric sources.

This represented 16 percent of its total generation.

Installed hydroelectric generating capacity was around 197 GW in 2009, according to FACTS Global Energy, accounting for over a fifth of total installed capacity. The State Energy Bureau announced plans to increase hydro capacity to 380 GW by 2020. The largest power project near completion is the Three Gorges Dam along the Yangtze River, which will include 32 separate 700MW generators, for a total of 22.5 GW. The Three Gorges project already has several units in operation, but the project is not expected to be fully completed until 2012. When fully completed, it will be the largest hydroelectric dam in the world.

Wind is the second leading renewable source for power generation, and China is the world’s fifth largest wind producer, generating 25 Bkwh in 2009, growing 100 percent from 2008. China’s installed wind capacity in 2010 was 16 GW, and has roughly doubled capacity each year since 2005. However, the lack of transmission infrastructure in this sector has left a significant amount of capacity underutilized.

The NDRC aims to increase wind capacity to 100 (8 CZ ʪ NUCLEAR China is actively promoting nuclear power as a clean and efficient source of electricity generation. Although China’s nuclear capacity of 10.8 GW makes up only a small fraction of the installed generating capacity, many of the major developments taking place in the Chinese electricity sector involve nuclear power.

China’s government forecasts that over 70 GW will be added by 2020. As of 2011, China had 13 operating reactors and 27 reactors under construction.

Following the Fukushima Daiichi accident in March 2011, China reported it was suspending government approvals for new nuclear plants until safety reviews were performed on current plants and those under construction. Many industry analysts do not see this incident significantly affecting China’s investment in new reactors.

China also intends to build strategic and commercial uranium stockpiles through overseas purchases as well as further developing domestic production in Inner Mongolia and Xinjiang.

One thing is for certain, China has a thirst for energy and is expanding its reach domestically and internationally.

Sources: EIA, IMF, Asian Energy Investment Council

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CHINA HYDRO

CHINA HYDRO REPORT C

hina Huadian Corp (CHD), one of the nation’s major power producers, plans to build four new hydropower stations across the country in the next five years that will increase its installed capacity by 10 million kW. Their aim is to have 26 million kW of installed hydropower capacity by 2015, which would account for 8 percent of the national total, the company said in its first Hydropower Sustainability Report released recently in Beijing. Blueprints call for new projects on the upper and middle stretches of the Jinshajiang River as well as the Wujiang and Nujiang rivers, company spokesman Yuan Minggang told a media briefing.

“Boosted by the nation’s stimulus policy for hydropower development during the 12th Five Year plan (2011-2015), the company will facilitate construction of the four hydropower projects to help China reach its goals in reducing carbon dioxide emissions,” said Yuan.

The reports said the company’s total installed hydropower capacity hit 15.38 million kW by the end of 2010, accounting for 7.3 percent of the nation’s total and 17 percent of the company’s energy mix. This coincides with the aim that by 2020 the government plan more than half of the nation’s nonfossil energy generation will come from hydropower, Zhang Guobao, the former energy minister explained toward the end of last year.

With such projects coming to light, various longevity, investor and quality concerns are being highlighted on a regular basis. Current project owners and operators including CHD have in the past often taken individual components for granted, despite the underlying understanding that if a problem occurs, this can result in significant costs and unit downtime.

One such issue of regular discussion, and that needs addressing and consideration seemingly very early on in a plant’s construction is that of solving leakage problems on main shaft seals.

A common challenge at many hydro plants throughout China no matter the size or location is water leaking from the seal around the turbine’s shaft.

On a turbine with a shaft diameter greater than 1 meter, industry experts are aware it’s near impossible for main shaft seals to completely eliminate leakage.

Instead, the seal functions must more so control leakage to an acceptable amount.

For this reason, choosing the right seal by way of considering individual plants and locations rather than relying on experience and plans of old is massively important. Some faults in hydropower stations are predictable from the outset. Others remain hidden until early production. Whatever the problem, there is often a direct or indirect link to some kind of seal. The cause of these problems and a whole variety of others is the type of seal design that has normally been used. Many of the problems often lead to repair work or even a permanent overhaul.

Plaited cords, elastomeric profile rings, moulded seals, and simple O-Rings are commonplace. Such seals can withstand neither extreme contamination of the water nor the vibration. The seals and their mating surface wear each other away. Sometimes abrasion of the material can even lead to the total disappearance of the seal.

Simply fitting a replacement will not eradicate any such problem. At the very least, the surfaces will have to be refashioned or redressed or, at worst and often the case, whole components replaced.

Problems of this nature can be avoided by using seals that differ from conventional types in respect

of their geometry and the materials employed. By ensuring correct technological steps with regards to R & D and engineering consultancy, the first step of knowing the problem being faced can be instantly addressed. Informing the manufacture is the second step. A technical designer of components should also be informed about the limit advantages and disadvantages of any seal. The designer could make a minor change to material or profile to get the seal functioning properly avoiding such problems and expenses before they arise.

An example of such whereby this has caused major problems on a large scale in recent years occurred when dust like materials and particles regularly enter CHD’s Sichuan Baozhusi and Yilihe plant’s waterways after periods of heavy rains. Sand and silt like materials blowing and being washed into the canals had been highlighted as issue needing attention immediately. Once this sand and silt ends up in the pumps, the implemented spring-energized, conical wedged mechanical seals have been destroyed, often within a three month period, resulting in the flooding of the pit at numerous reoccurring instances.

Following analysis of; the water conditions below the seal, the water supply to the seal, the pressures below the seal as well as the access to the seal area for assembly and disassembly of the seal unit, ensuring the replacement without having to dismantle the entire pump turbine, lead to an axial type sealing solution that ultimately proved able to cope with these location based problems.

Sealing design alone however is not the cure.

Material selection is also key. The now implemented model has an innovative combination of face materials that can withstand severe applications but has already shown signs of wear (despite making is past the 3 month bench mark of its predecessor).

Eradicating this issue fully seemingly requires a mix of conventional metals and composite materials to meet all of the requirements at once.

As enhancements throughout the field begin to be more readily available, and with such information supplied throughout the market of examples of solutions and their application, it seems more and more unjustifiable for such issues to continue to be such an issue. With this being the case, addressing problems with such an individual component ensures the protection of many others, and is indeed why it needs to be tackled with such urgency and importance.

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CHINA WIND POWER

BLOWING UP A STORM IN CHINA

BY CHARLIE FOX

CHINA IS SEEKING TO CHALLENGE GENERAL ELECTRIC AND OTHER WESTERN FIRMS IN THE WIND TURBINE MARKET, A MOVE BACKED BY MORE THAN $15 BILLION IN GOVERNMENT SUPPORT.

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lready the country with the highest wind power installed capacity, Chinese windmill makers such as Sinovel Wind Group and Xinjiang Goldwind Science & Technology are planning to set up plants overseas, including in the United States.

‘China has become the single largest driver for global wind power development.

In 2010, every second wind turbine that was added anywhere in the world was installed in China,’ according to Steve Sawyer, secretary general of the Global Wind Energy Council.

According to the Council, China’s wind turbines market ‘doubled every year between 2005 and 2009 in terms of total installed capacity, and it has been the world’s largest annual market since 2009.’ Last year, China added 18.9 GW of new wind energy capacity, meaning its total wind power installed capacity jumped to 44.7 GW, more than the United States.

Such growth raises a tantalizing prospect – could wind power become competitive with fossil fuel? At current rates it possibly could.

‘A shift to Chinese suppliers could even nudge down the cost of wind power enough for it to compete with coal and natural gas in the US and Europe when the wind is blowing, threatening fossil fuel-based business models at utilities,’ it notes.

‘While US President Barack Obama and Chinese Premier Wen Jiabao both said developing clean energy is a top industrial priority, China is increasingly gaining the manufacturing base for equipment needed to wean their economies from fossil fuels.’

While China has to regularly face the ignominy of seeing its cities ranked among the worlds most polluted, Beijing has been stung by criticism that it’s sacrificing the environment for the sake of economic growth. Indeed, last year, China invested some $54.4 billion in clean energy, according to a Pew Charitable Trusts report, far ahead of second-placed Germany ($41.2 billion) and the United States with $34 billion.

‘Countries like China, Germany, Italy and India were attractive to financers because they have national policies that support renewable energy standards, carbon reduction targets and/or incentives for investment and production and that create long-term certainty for investors,’ noted the report, released in March.

‘However, there is ambiguity surrounding clean energy policies in the United States and the United Kingdom, which likely has caused investors to look elsewhere for opportunities.’

Still, as a report in the Financial Times noted, concerns persist over the safety of China’s wind turbines following a crane collapse this week that saw five people killed.

‘Cranes collapse all the time in China and in other countries. But the recent accident fits into a series of mishaps in China that have renewed concerns about safety and quality standards in the turbine industry,’ the FT notes. ‘Chinese wind farms have also struggled with grid failures, causing large-scale blackouts at least twice this year.’

Still, compared with the problems that blight the country’s coal industry, wind power remains a relatively safe and increasingly attractive option.

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INDIA FOCUS

FEATURE INTERVIEW WITH MR. J. M. MAUSKAR MR. J. M. MAUSKAR - SPECIAL SECRETARY, THE INDIAN MINISTRY OF ENVIRONMENT AND FORESTRY, GOVERNMENT OF INDIA. Mr. Mauskar, welcome to the India focused edition for Pi Magazine Asia. Thank you for taking time to speak with us.

PI: Can you provide us with a brief outline of your responsibility within the MOEF? JM: I am a Civil Servant with experience both at the state level and federal level of over 34 years in varied field of rural development, upstream petroleum sector, trade and investment promotion and environment, including climate change. After retirement in October, 2011, I have been reemployed for a period of six months by the Central Government as Special Secretary in the Ministry of Environment and Forests basically for climate change matters and also policy aspects of impact assessment and coastal zones.

PI: The Indian power sector is arguably taking on the most ambitious workload for new capacity globally, what are the most important environmental clearance factors that developers should be prioritizing?

JM: Impacts of power plants and their mitigation globally are location-specific and technologyspecific. In India, because of high ash content of the coal, utilization of fly ash becomes crucial;

similarly for coastal power plants with imported coal as a fuel, sulphur dioxide concentrations and desulphurizational aspects are critical. Of course, the over-arching theme of optimal resource consumption, be it land or water or the fuel, has its own importance. In todayâ&#x20AC;&#x2122;s scenario, the key consideration for a project proponent in thermal power sector would be assured long term availability of coal of stipulated standards and requisite quantity.

In the years to come, the availability of land and water could also be of larger consequence than today.

They may also be well advised to look for and use technologies that help them achieve higher efficiency in coal fired power generation although this remains strictly a voluntary choice in the foreseeable future.

Economic incentives for such efficiency gains are available through Perform, Achieve and Trade scheme of Bureau of Energy Efficiency.

PI: The optimal use of natural resources is key for power plants in sustainable development.

Can you give any recent examples of projects that have shown excellence in compliance and have really gone the extra mile to consider the environment?

JM: The Ministryâ&#x20AC;&#x2122;s approach is generally to stipulate pollution norms, which in case of power projects,

would relate to the level of SOx, NOx and particulate matter as also maximum limit of utilization of water and land. Of course, the quantity of power to be generated is specified , but the Ministry does not stipulate the technology to be used or other such details. The objective is that these are technocommercial decisions to be taken by the project proponents and the Ministry is concerned with the possible pollution and utilization of resources like water being within the limits, modelled or proposed in the project reports, appraised by the Expert Appraisal Committee.

PI: The single largest industrial use for water in India is for the power industry, how can this be decreased to give preference to irrigation and other critical uses? Are you trying to encourage a reduction in water usage?

JM: Some solutions which came to mind are setting up of power plants near the coasts using sea water, use of close circuit cooling for inland power plants and increase in cycle of concentration (CoC). Small power plants can go in for air cooling in view of the recent technological improvements. While benefits of air or dry cooling are evident for smaller power plants of around 50MW, the auxiliary power consumption increases as contrasted to water cooling.

PI: The recent coal blocks have been well documented, what challenges are you facing here as a policy maker?

JM: One way to look at the problem is to consider it as intra generation versus inter generation equity; i.e. balancing the needs of present population with the future generations. Another way to look at it is how to have economic and social development as also to eradicate poverty, while maintaining ecological and environmental security. The paradigm for such balancing is the sustainable development, be it thermal power projects or other projects. Another important consideration while permitting the use of natural sources for present and future projects is that of optimising revenue generation. Governments typically balance the revenue maximisation objectives with the overall social and environmental costs over a longer period of time. Obviously, the balance will

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need to be struck in light of the constitutional and statutory framework and the guidance of courts of law while being sensitive to aspirations of the people and other relevant stakeholders.

PI: What do you have to consider for mining in permit approval for a pit head thermal power project?

JM: Pithead power plants are attractive in the sense that with the national grid more or less in place, it is environmentally preferable to transport power rather than to transport coal over long distances.

However, what would need to be considered while appraising such power projects is the availability of land and water for cooling. Also the environmental and forestry clearances for the coal mine assume their own criticality in case the coal is not being sourced from an existing mine. Lastly, due to the non-linear nature of health and ecological impacts of pollution impacts, and despite the theories of the economic benefit of cluster of industries or power plants, regional EIA or a carrying capacity study may need also to be mandated.

PI: Have there been any recent Acts and regulations passed relating to the power industry that power producers and developers need to be aware of?

JM: There are no recent legislations, whether for environment or for forest sector. However, there are number of relevant directions and judgements of the High Courts and the Supreme Court which need to be complied with; and these are made known to the stakeholders at large through issue of administrative instructions and like, which are also uploaded on the website of the Ministry of Environment and Forests (moef.nic.in). Further

for the sake of transparency and keeping in mind the dynamics of the development process, whether for power sector or other sectors, a number of instructions are issued from time to time, which are also uploaded on the website. For example, an Office Memorandum was issued on 26th April, 2011 which aims at integration of environmental concerns into day-to-day functioning of major projects, such as coal based power plants with capacity of 500 MW and above. With the ultimate objective to promote environmental consciousness and secure compliance in order to protect the stakeholders of the projects.

Government has also launched a specific initiative to promote energy efficiency both on supply side and demand side. PAT Scheme of the Ministry of Power has been implemented by amending the Electricity Act with a view to facilitate grading in energy efficiency certificates between more efficient and less efficient plants including those in power sector.

PI: Do you work closely with other governments in Asia to have a degree of correlation in policy for the combat against climate change?

JM: Climate Change is a global phenomena and not a regional phenomena. The United Nations Framework Convention on Climate Change (UNFCCC) is the international legal treaty to which almost all the countries, including those in Asia, are parties. The UNFCCC is based on the principles of equity and Common but Differentiated Responsibilities (CBDR). India, as a developing country, anchors itself in the Group of 77/China as do the other Asian countries. As such the principal arena for deliberating upon combating climate change is under the UNFCCC . However, along with other environmental and developmental issues, climate change issues also come up for bilateral and

pluri-lateral discussions between India and other countries. As a developing country, India seeks to ensure that climate change concerns do not adversely affect policy choices in terms of development strategy.

However, there are voluntary national goals that are to be met within a global framework of cooperation and nationally determined policies.

PI: What is your opinion on the Indian energy outlook for 2030? How do you envisage the industries development?

JM: Use of energy and the industrial development are closely co-related with emissions of the Greenhouse Gases. In 2009, India declared that as its voluntary actions related to mitigation that it would endeavour to reduce the GHG intensity of its GDP by 20 to 25 per cent, as compared to the level in 2005, by the year 2020. Climate Change is going to be a key issue during the implementation of the Indian 12th Five Year Plan (2012-17) and the Plan Document is under finalization. Our national policy for addressing climate change is driven by our concerns for adaptation and energy security for the country. Although several demand side efforts are already underway to maximise efficiency gains, supply constraints on energy side will remain our dominant concern and technology will be the key issue in this regard. Separately, a Lower Carbon Energy Strategy is also under finalization. In any case, due to paucity of oil and natural gas in its territory, India besides using its natural endowment of coal, is very actively promoting energy efficiency, fuel conservation and alternative source of power such as solar, hydro and wind. All our development policies and strategies, as mentioned earlier, are towards the goal of poverty eradication and sustainable development in India in accordance with the RIO principles.

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DIRECT AIR COOLED CONDENSER TUBES

FERAN® - THE PERFECT MATERIAL FOR DIRECT AIR COOLED CONDENSER TUBES (DACC) T

he cooling of power plants is an important and critical issue. Especially – but not only - in regions where you are short of water the cooling of a power plant could cause problems as there isn´t enough water available for the cooling. That´s why since some years the dry cooling - means cooling with air - has become more and more common.

What is needed for this type of cooling system is a tube with aluminium-fins.

Picture 3: Picture of an air cooled condenser tube with brazed fins

Picture 1

And this is where FERAN® from Wickeder Westfalenstahl comes in. FERAN® is a clad combination made out of aluminium and steel (picture 1). Clad materials are two or multi-layer metallic composites. The strips are bonded together under high pressure and become inseparable (picture 2: diagram of bonding process). The exciting thing is that you can combine the different properties of the two metals in one material. So also in the case of FERAN® – where the properties of aluminium are combined with those of steel. Steel as a sophisticated and inexpensive base material ensures the required strenght properties for the building and stability of the tube. Aluminium on the other hand is needed on the outer side of the tube as a transition material – as the fin material out of aluminium has to be joined to the aluminium-surface (picture 3: Picture of an air cooled condenser tube with brazed fins).With the material FERAN® all brazing alloys can be used (4343, 4045, 4047).

There are some special requirements for Direct Air Cooled Condenser products: For example a really strong bonding – without delamination - between aluminium and steel is essential. No brittle regions in the diffusion zone between aluminium and steel before, during and after the sensitive brazing process Picture 2: Diagram of bonding process

are allowed as it is essential that no aluminium splints can come into the cooling circle. The most dangerous problem with DACC systems is a failure which will occur during operation of the power plant and is not detected at the end of the production of the bundles.

A delamination after the start of the power plant will dramatically reduce the efficiency of the power plant.

If a replacement of bundles becomes necessary this will cause tremendous costs for the power plant.

Another important thing during the brazing process is the thermal stability. Due to its inseperable bonding of the two metals and its thermal properties FERAN® fulfills these requirements.

For an optimum welding of the tubes the two metals are not bonded at the edges. The Al-free edges that are achieved by edge free cladding guarantees a highly efficient welding process of the steel tubes: tube manufacturers can weld steel to steel.

Picture 4: Wickeder Westfalenstahl GmbH

Wickeder Westfalenstahl, founded in 1913 and based in Wickede (Ruhr), Germany, is producing clad materials for decades (picture 4: Wickeder Westfalenstahl GmbH). Named with the trademark FERAN® the clad compound out of aluminium and steel is successfully used since 20 years in air cooled condenser tubes for the air cooling in power plants.

In this time Wickeder Westfalenstahl has delivered a volume of FERAN®-material for power plant applications which allowed the construction of up to t 460 power plant at 2 x 600 MW t or 900 power plant at 2 x 300 MW t or 2.800 power plants at 2 x 100 MW.

t The total installed capacity with FERAN® has already reached 550.000 MW. The material has 100% reliabilty over 20 years of operation – no field failure ever reported. The direct air cooled condenser systems with FERAN® have an optimized behaviour during hot and cold periods as well as a good resistance against wind and storm.

The consistency of production parameters – which is guaranteed by Wickeder Westfalenstahl due to the production of several thousand tons of material - is essential to fulfill the requirements of modern direct air cooled condenser tubes. The following factors play an important role: t Material selection for the right combination of aluminium and steel t Optimization of the production parameters for heat treatment, rolling, surface preparation and edge free cladding.

Compared to other materials used in the power plant industry the FERAN®-tube consists out of an integral Al-layer of at minimum 50µm on the outer side (picture 5). This avoids any corrosion of the air cooled condenser and guarantees a stable bonding and brazing connection for the aluminium fins – the heat transfer is reliable.

Also the material for the Direct Air Cooled Condenser-tubes (DACC) for the new to be constructed power plant Tori Thermal Power Plant – project in Chandwa, Jharkhand, India, will be delivered by Wickeder Westfalenstahl. The installed capacity will be 3 x 600 MW. The project is worldwide the biggest single power plant project with direct air cooling. 1.5 Millions running meters of cooling tubes will be used. They will be placed in constructions of over 50 m in an area of several pitches.

If you are also interested in this quality material made in Germany please visit us at Powergen India, stand 1004A or give us a call. Your contact person, Hans-Jürgen Gauger, Tel.: +49 2377/917 – 764, is awaiting your questions.

For more information you can also visit the folowing website: www.wickeder.com

Picture 5: Microsection of FERAN®

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DRY COOLING ROUND TABLE

DRY COOLING IN ASIA: A HOT TOPIC

THIS ISSUE SEES PI MAGAZINE ASIA TAKE A CLOSE LOOK AT DRY COOLING IN ASIA. AN EXCITING SECTOR THAT CAN GIVE PLANT DEVELOPERS FLEXIBILITY IN SITE SELECTION & COOLING OPTIONS IN WATER STRICKEN AREAS IS SEEING A STEADY GROWTH IN IMPLEMENTATION. WE CAUGHT UP WITH THE SECTOR’S THREE MAJOR PLAYERS SPX, GEA EGI & SPIG SPA, TO UNDERSTAND DIRECTION OF THE MARKET. 32 MARCH/APRIL 2012 POWER INSIDER

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Welcome Philippe to the current issue of PI Magazine Asia. Thank you for taking time to speak with us.

PHILIPPE NAGEL, SPX PRESIDENT, GLOBAL DRY COOLING

PI: Can you provide us with a brief outline of your operations in the cooling business for Asia?

PN: Yes, for sure. For a global player like SPX, a rapidly growing region like Asia is indeed a priority.

In China, SPX has a large operating office in Beijing (in a joint venture with Shanghai Electric, since January 1, 2012) and two workshops, which have supplied dry cooling systems representing a cumulative Power Plant capacity of more than 40.000MW since 2002.

In India, we are operating and working with our joint venture company, Thermax-SPX based in Pune.

We are pursuing dry cooling systems to captive and large power plants. Our partner Thermax is a well-known Indian EPC Contractor and supplier of various thermal equipment for power plants including boilers, air preheaters, electrostatic precipitators etc.

In Korea, our SPX office in Seoul is serving Korean EPC’s. We have many recent large dry references for the Middle East and South America, including Riyadh PP11, Amman East, Al Qatrana, Rotem, Kalpa and Chilca.

SPX is also a reference supplier for most of the other Asian EPC’s, such as Mitsubishi in Japan, as well as a number of developers, thanks to our broad network of Asian representatives.

PI: How do you envisage the dry cooling market developing in Asia?

PN: This is indeed a fair question. Water scarcity is

the challenge of this century.

In China, the dry cooling market is impressive and represents a significant part of the new power plants installed these last 10 years in the world. After rapid initial growth, this huge market is expected to continue to increase, but probably more moderately.

In India, the dry cooling market was growing very quickly for captive power plants (<80MW) between 2000 and 2008. Very recently, a new market for large power plants has emerged. However, growth has been limited due to uncertainty surrounding the financing and permitting of new projects. Nevertheless, we are confident this market will eventually develop in the near future.

Other Asian countries today are also emerging as more opportunistic markets, and we believe that, in the future, some of these countries will follow the general trend and focus more on dry cooling.

PI: What advances have you had in your technology?

PN: I cannot answer your question without a brief technological introduction first, sorry for that!

Dry cooling basically uses two primary technologies for power plants.

The first technology is an air-cooled condenser (ACC), which represents about 90% of the installed capacity in the world of dry-cooled power plants. The ACC acts as a “huge radiator” condensing the turbine steam. Fans blow the ambient air on the “radiator” in order to dissipate the heat in the atmosphere. During the 1990s, our team pioneered a revolutionary new radiator using a brazed aluminium technology: the Single Row Condenser- SRCTM. Our success was

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DRY COOLING ROUND TABLE

KENDAL project, Kendal, South Africa – 6x690MW Coal Fired Power plant – Indirect Dry Cooling System

such that today, more than 90% of power plant developers choose a single row technology as their preferred dry cooling technology. Because of our early work with SRCs, we now boast one of the the world’s largest and far reaching reference base and maintain a track record of continuous innovative improvements and new developments with this technology. Today, our ACCs offer exceptional reliability at a very competitive price.

The second technology is the natural draft dry cooling tower. This equipment also uses “radiators” installed around the periphery of a 120 to 170 meters high concrete tower. Like a chimney, the tower ensures an air circulation along the “radiators” using a natural draft effect. Natural draft replaces the need for the fans associated with ACCs. Just about 10% of the installed capacity worldwide leverages natural draft dry cooling, as the capital investment is significantly higher than for ACC’s and the return on investment can typically only be achieved after 15 to 20 years. This option is quite exclusively used in China, with some rare exceptions in other parts of the world.

The largest system presently operating in the world was installed at the end of the 1980s and is an SPX reference (the Kendal Power Plant 6x 660MWcoal fired plant in South Africa). Thanks to intensive R&D, we recently introduced a new concept on the market and have already several references for large coal fired power plants.

Our new SPX concept uses very high, one piece “radiators” called MegaDeltaTM. At a very competitive price, this new innovation provides customers with an outstanding value proposition compared to other natural draft dry cooling products on the market, and features numerous benefits regarding auxiliary power needs, radiators resistance, maintenance and water treatment.

PI: What are the most successful projects you

have been involved in recently?

SPX is a global leader in dry cooling for large and small power plants (biomass, etc.).

For coal-fired power plants, we are presently installing the largest air-cooled condenser in the world in South Af rica. The Kusile power plant is scheduled to have a capacity of 4800MW when completed.

The total size of the installation is approximately 700 meters long and 70 meters high. In China, we recently completed some very large ACC projects such as the Zhenglan power plant (6x600MW).

We are also installing natural draft dry cooling towers at Zuoquan (2x660MW), Qinling (2x600MW) and more recently at WuAn (2x300MW).

For gas-fired power plants, we have several projects underway in the Middle East, such as Riyadh PP11 (1700MW), as well as other projects in Turkey, South America, Europe and the United States.

SPX is also actively supplying dry cooling systems to solar thermal power plants. We have been awarded contracts for ACC systems at some of the largest solar plants in development in the world, including two in Southern California in the US. More recently, we were contracted to provide a parallel cooling system to the Crescent Dunes Solar Energy Project in Tonopah, Nevada. Here, we will apply our PCSTM concept, which consists of a combination between dry cooling and wet cooling.

SPX is of course in an ideal position for optimizing such a turnkey cooling system, being a supplier of ACCs, surface condensers and wet cooling towers.

PI: Asia is seeing a significant change in the power generation stake holding, as capacity is rapidly increasing for a number of ambitious IPPs, do you feel this is a positive factor?

PN: This is definitely a positive trend, as this increases the diversity and the vitality of the market.

IPP’s are generally looking at the most innovative and reliable solutions in a competitive environment.

We are confident that SPX is very well positioned for this challenge.

PI: When looking at reliability and efficiency of cooling system, what are the most important factors an operator should consider?

PN: In terms of efficiency, the operator should first consider the balance between the capital cost and the cost of auxiliary power consumed by the dry cooling system. Cheap solutions generally consume more auxiliary power with a negative impact on the power plant’s operating efficiency. This is a generally well-known principle. What is often ignored is how – over the long term - the quality of the “radiators” can have a dramatic impact on the efficiency of the power plant due to the continuous deterioration of the heat exchange characteristics. For example, I mentioned the Single Row Condenser technology, which today is considered “state-of-the art.” Many single row technologies may at first appear similar despite vital differences in geometry, in the material selection and in the manufacturing process or quality.

After a certain period of operation, those important differences can result in a higher sensitivity to fouling by a dusty atmosphere, to heat transfer surface corrosion, mechanical wearing, and even freezing damages (when applicable).

Suffice to say that all these features will gradually affect thermal efficiency over the lifetime of a power plant. Reliability cannot be dissociated from efficiency. Top quality products and sustainable performance are a must for major investments that have such a direct impact on the life of a power plant.

With more than 50 years of proven experience in dry cooling and 25 years with a leading technology like the SRCTM, SPX is ideally positioned to help operators achieve their objectives for power plant reliability and efficiency.

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Our business is the design, engineering and supply of complete cooling systems using either Wet or Dry technology. SPIG has also a well developed and extensive Service business that provides maintenance, revamping & upgrades, spare parts and remote monitoring systems.

ANDREAS COUMANS – EXECUTIVE VP, SPIG SPA

Welcome Andreas, to the current issue of Pi Magazine Asia. Thank you for taking time to speak with us.

PI: Can you provide us with a brief outline of your operations in the cooling business for Asia?

AC: SPIG has long been directly involved in Asia through our own operations in India and China.

Furthermore, SPIG has been a successful supplier of Cooling Plants for many years to clients in the Power industry and through international EPC contractors.

PI: How do you envisage the dry cooling market developing in Asia?

AC: We consider dry cooling as a growth potential in most of Asia. The need to deliver the thermal cooling requirements with the use of air as a medium, is gaining market acceptance. Both direct dry and indirect dry supports this market trend and we expect the growth will be registered throughout the region.

China today leads the trend in Dry cooling next to Japan and Korea. However, many other economies including Indonesia, Vietnam, India and Bangladesh are making changes towards dry cooling, offering our industry further potential for growth.

PI: What advances have you had in your technology?

AC: In dry cooling technology SPIG has been able to Improve thermal efficiency with the use of sprayed on adiabatic systems that manages peak summer loads. In air finned cooler products, various fine configurations are today readily available with SPIG proposals. In addition, noise control and extra quite installations are guaranteed through better fan developments. In the air cooled steam condenser field, the Single Row tube bundle designs are today the recognised ‘state of the art’ technology replacing previous multi row designs.

SPIG has also developed a unique remote monitoring system that allows operators to read electronic transducers then converting and storing the data which is consequently transmitted wirelessly using units that are powered with solar panels.

PI: What are the most successful projects you have been involved in recently?

AC: 850 MW CCGT POWER PLANT under execution with state of the art single row tube technology, using 42 cells 2X22.5 MW GEOTHERMAL ORC application using dry technology in a 56 cell installation 120 MW POWER PLANT using adiabatic auxiliary cooler with 240 tube bundles in a 24 cell installation PI: Asia is seeing a significant change in the power generation stake holding, as capacity is rapidly increasing for a number of ambitious IPPs, do you feel this is a positive factor?

AC: Yes, we see positive such capacity increases which typically indicate economic growth. The power market is rapidly changing in countries such as India where IPPs are investing rapidly to bring power output on line. The issue of clean energy will continue to be a challenge as the countries develop further their power infrastructure. Ambitious IPP investments are a welcome development which should be encouraged however with the provision that they do support local economies and protect the environment.

PI: When looking at reliability and efficiency of cooling system, what are the most important factors an operator should consider?

AC: A critical component of reliability is equipment maintenance. Often the level of maintenance determines the extent of plant efficiency. Mechanical equipment by nature requires well defined and consistent looking after. In addition to the actual maintenance issues, cooling systems must have robust means of monitoring performance that will enable the in time corrective operator actions. Such monitoring equipment together with common sense preventive maintenance programs will extend the life of the cooling plant and ensure reliable and efficient output.

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DRY COOLING ROUND TABLE Welcome András to the current issue of Pi Magazine Asia. Thank you for taking time to speak with us.

PI: Can you provide us with a brief outline of your operations in the cooling business for Asia?

AB: Our Asian business has two distinct parts;operations in the Asian territory of Russia and our Chinese operations. Both markets are vivid with new projects coming up. We are there with our engineering/contracting centers, European and Chinese manufacturing plants and services available for our customers.

ANDRÁS BALOGH, PRESIDENT & CEO – GEA EGI

PI: How do you envisage the dry cooling market developing in Asia?

AB: The dry cooling market is different in different regions and our answers are also different as we devote efforts and attention to meet project specific requirements, whether they stem in the difference in plot area available, plant layout, weather conditions or seismicity of the region in question. As for coal fired units, with mine mouth plants emerging, dry cooling seems to be the only option in most of the cases. Elsewhere, where gas replaces coal with plant extensions, constraint of existing plant sites call for dry cooling with technical solution different than in areas where such constraints do not prevail.

PI: What advances have you had in your technology?

AB: We have considerable success both in the natural draught and in the mechanical draught applications. Our natural draught systems have direct contact (DC) jet condensers fit for the applications with large supercritical units with multiple, double flow LP casings. We have also DC jet condensers designed for turbines with axial, lateral or upward exhaust. Indirect dry cooling systems built with conventional surface condenser require a larger cooling tower due to the terminal temperature difference of the former, while direct contact jet condensers virtually eliminate such temperature difference, as the turbine exhaust steam condenses directly on the surface of cooling water films.

Our mechanical draught systems are equipped with modular cell-type towers that excel in versatility of application in constrained sites. We have also elaborated combined dry/wet solutions for conventional and for nuclear applications, that achieve target annual water saving relative to the allwet cooling.

PI: What are the most successful projects you have been involved in recently?

AB: Most successful recent projects are the Heller indirect dry cooling systems with direct contact jet condensers built for 660 MW supercritical coal fired units, the mechanical draught Heller system built for large CCGTs and the proven mechanical draught systems designed for severe winter applications.

We are also proud of the projects where our Heller cooling tower serves more than the generating unit and where the flue gases are exhausted via the Heller dry cooling tower. In the latter case not only the investment cost of the tall chimney and the investment- and O&M costs of gas-to-gas heater are saved but the environmental impact of the residual airborne pollutants is reduced by better spreading, thus lowering their ground level concentration.

PI: Asia is seeing a significant change in the power generation stake holding, as capacity is rapidly increasing for a number of ambitious IPPs, do you feel this is a positive factor?

AB: The advantages of the Heller indirect dry cooling system (lower auxiliary power consumption, lower operation and maintenance costs) primarily manifest with plant owners and operators. Independent power producers are our regular customers having long-term viewsand strategic thinking and we do our utmost to understand their needs and meet their requirements.

PI: When looking at reliability and efficiency of cooling system, what are the most important factors an operator should consider?

Every dry cooling system has its own merits. When we introduce our Heller indirect dry cooling system to our customers, we emphasize its modularity, simple build and passive nature that are key contributors to its success. Insensitivity to wind gusts, adaptability to all modern power cycle water chemistries are also important factors operators should consider. And last but not least, selection of the cooling system may positively influence the licensing of the plant (FGDin-Tower, Stack-in-Tower solutions).

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INDIA HYDRO

INDIAN SMALL HYDRO POWER CATCH UP

BY DANIEL ROGERS

P

rojects pushed for tender and supported by the Ministry of New and Renewable Energy are normally economically viable and private sector is showing lot of interest in investing in SHP projects.

The viability of these projects improves with increase in the project capacity. The Ministry’s aim is that at least 50% of the potential in the country is harnessed in the next 10 years.

The Small Hydro Power (SHP) Programme is one of the thrust areas of power generation from renewable in the Ministry of New and Renewable Energy. It has been recognized that small hydropower projects can play a critical role in improving the overall energy scenario of the country and in particular for remote and inaccessible areas. The Ministry is encouraging development of small hydro projects both in the public as well as private sector. Equal attention is being paid to grid-interactive and decentralized projects.

Aim: The Ministry’s aim is that the SHP installed capacity should be about 7000 MW by the end of 12th Plan. The focus of the SHP programme is to lower the cost of equipment, increase its reliability and set up projects in areas which give the maximum advantage in terms of capacity utilisation.

Potential: An estimated potential of about 15,000 MW of small hydro power projects exists in India.

Ministry of New and Renewable Energy has created a database of potential sites of small hydro and 5,415 potential sites with an aggregate capacity of 14,305.47 MW for projects up to 25 MW capacity have been identified.

The Ministry of New and Renewable Energy is implementing a programme for development of small hydro power projects in the country. The Ministry provides Central Financial Assistance to set up small / micro hydro projects both in public and private sectors. Central Financial support is also given to the State Government for identification of new potential sites including survey and preparation of DPRs and

renovation and modernization of old small hydro power (SHP) projects.

So far, 847 SHP projects with an aggregate capacity of 3197 MW have been setup and 356 projects aggregating to 1045 MW are under implementation in the country. In the State of Uttar Pradesh, 9 SHP projects aggregating to 25.10 MW have been set up.

Apart from fiscal and financial incentives, technical support is extended on various aspects of small hydro through Alternate Hydro Energy Centre, IIT Roorkee and other technical institutions. The Ministry is giving special emphasis for the development of micro hydel and watermills for remote areas in the country.

With such developments coming to light and being implemented, longevity and consistency is key for investors and ensuring proven solutions and safe mechanisms which are able to cope with the varying weather conditions, and therefore differences in river

flow conditions, that India is accustomed to, remains of high priority.

One of the main areas of the implementation steps, will include establishing a community committee for the project, conducting a feasibility study to assess the best location for the plant, building the plant and the electricity distribution system, and then operating and maintaining the plant.

The power system is owned by all power consumers, called the General Body. This Body elects a nine-member executive committee, which manages the power system. A village electrician, a local youth, is appointed by the General Body, and is paid a monthly sum of Rs. 1500, or approximately $60.The electricity generated by the plant is used for lighting, water pumping, television and radio. The system involves 10km of distribution lines laid by the community. The water storage system for electricity generation helps recharge the groundwater, which has improved irrigation.

ENVIRONMENTAL BENEFITS Since most village’s previously depended upon kerosene and sometimes firewood for lighting, the installation of electrical connections in households will reduced their use of these fuels, there by reducing greenhouse gas emissions . However, during the summer months, water in the river’s is insufficient to generate hydropower, so during this time the community will need to rely on a diesel generator.

The generator will be installed by the project, and it is not clear whether this generator emits more or less greenhouse gases than was formerly emitted through kerosene use.

Importantly lets not forget, this is about bringing Power to the rural villages throughout the region, so mistakes will be made and errors will occur, but if we can improve social, economical well being these projects can only be deemed successful.

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INDIA COAL

COAL INDIA: BLACK GOLD OR PLANET KILLER?

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I

ndia has a long history of commercial coal mining covering nearly 220 years starting from 1774 by M/s Sumner and Heatly of East India Company in the Raniganj Coalfield along the Western bank of river Damodar. However, for about a century the growth of Indian coal mining remained sluggish for want of demand but the introduction of steam locomotives in 1853 gave a fillip to it. Within a short span, production rose to an annual average of 1 million tonne (mt) and India could produce 6.12 mts. per year by 1900 and 18 mts per year by 1920.

The production got a sudden boost from the First World War but went through a slump in the early thirties. The production reached a level of 29 mts. by 1942 and 30 mts. by 1946.

With the advent of Independence, the country embarked upon the 5-year development plans. At the beginning of the 1st Plan, annual production went upto 33 mts. During the 1st Plan period itself, the need for increasing coal production efficiently by systematic and scientific development of the coal industry was being felt. Setting up of the National Coal Development Corporation (NCDC), Government of India Undertaking in 1956 with the collieries owned by the railways as its nucleus was the first major step towards planned development of Indian Coal Industry. Along with the Singareni Collieries Company Ltd. (SCCL), which was already in operation since, 1945 and which became a Government company under the control of Government of Andhra Pradesh in 1956, India thus had two Government coal companies in the fifties.

SCCL is now a joint undertaking of Government of Andhra Pradesh and Government of India sharing its equity in 51:49 ratio.

NATIONALISATION OF COAL MINES Right from its genesis, the commercial coal mining in modern times in India has been dictated by the needs of the domestic consumption. On account of the growing needs of the steel industry, a thrust had to be given on systematic exploitation of coking coal reserves in Jharia Coalfield. Adequate capital investment to meet the burgeoning energy needs of the country was not forthcoming from the private coalmine owners. Unscientific mining practices adopted by some of them and poor working conditions of labor in some of the private coalmines became matters of concern for the Government. On account of these reasons, the Central Government took a decision to nationalize the private coalmines.

The nationalization was done in two phases, the first with the coking coalmines in 1971-72 and then with the non-coking coalmines in 1973. In October 1971, the Coking Coal Mines (Emergency Provisions) Act, 1971 provided for taking over in public interest of the management of coking coal mines and coke oven plants pending nationalization. This was followed by the Coking Coal Mines (Nationalization) Act, 1972 under which the coking coal mines and the coke oven plants other than those with the Tata Iron & Steel Company Limited and Indian Iron & Steel Company Limited, were nationalized on 1.5.1972 and brought under the Bharat Coking Coal Limited (BCCL), a new Central Government Undertaking. Another enactment, namely the Coal Mines (Taking Over of Management) Act, 1973, extended the right of the Government of India to take over the management of the coking and non-coking coalmines in seven States including the coking coalmines taken over in 1971. This was

followed by the nationalization of all these mines on 1.5.1973 with the enactment of the Coal Mines (Nationalization) Act, 1973, which now is the piece of Central legislation determining the eligibility of coal mining in India.

WHY IS COAL THE NATURAL CHOICE IN INDIA? COAL is the most important and abundant fossil fuel in India. It accounts for 55% of the country’s energy need. The country’s industrial heritage was built upon indigenous coal.

Commercial primary energy consumption in India has grown by about 700% in the last four decades. The current per capita commercial primary energy consumption in India is about 350 kgoe/ year, which is well below that of developed countries.

Driven by the rising population, expanding economy and a quest for improved quality of life, energy usage in India is expected to rise around 450 kgoe/year in 2010. Considering the limited reserve potentiality of petroleum & natural gas, eco-conservation restriction on hydel project and geo-political perception of nuclear power, coal will continue to occupy center-stage of India ‘s energy scenario.

With hard coal reserves around 246 billion tonnes, of which 92 billion tonnes are proven, Indian coal offers a unique ecofriendly fuel source to domestic energy market for the next century and beyond. Hard coal deposit spread over 27 major coalfields, are mainly confined to eastern and south central parts of the country.

The lignite reserves stand at a level around 36 billion tones, of which 90 % occur in the southern State of Tamil Nadu.

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INDIA COAL INVENTORY OF GEOLOGICAL RESOURCES OF COAL IN INDIA As a result of exploration carried out up to the maximum depth of 1200m by the GSI, CMPDI, SCCL and MECL etc, a cumulative total of 285862.21 Million Tones of Geological Resources of Coal have so far been estimated in the country as on 1.4.2011. The details of state-wise geological resources of coal are given as under:

(A) : GONDWANA COALFIELDS :(in Million Tonnes) State

Proved 9296.85 0 0 12878.99 39760.73 8871.31 5489.61 24491.71 0 866.05 11752.54 113407.79

Andhra Pradesh Assam Bihar Chhattisgarh Jharkhand Madhya Pradesh Maharashtra Orissa Sikkim Uttar Pradesh West Bengal Total

Geological Resources of Coal Indicated Inferred 9728.37 3029.36 2.79 0 0 160 32390.38 4010.88 32591.56 6583.69 12191.72 2062.70 3094.29 1949.51 33986.96 10680.21 58.25 42.98 195.75 0 13131.69 5070.69 137371.76 33590.02

(B) : TERTIARY COALFIELDS :(in Million Tonnes) State

Total 22054.58 2.79 160 49280.25 78935.98 23125.73 10533.41 69158.88 101.23 1061.80 29954.92 284369.57

Geological Resources of Coal Proved

Indicated

Inferred (Exploration)

Inferred (Mapping)

Arunachal Pradesh

Total

31.23

40.11

12.89

6.00

90.23

464.78

42.72

0.50

2.52

510.52

Meghalaya

89.04

16.51

27.58

443.35

576.48

Nagaland

8.76

0

8.60

298.05

315.41

593.81

99.34

49.57

749.92

1492.64

Assam

Total

(Source: Geological Survey of India) CATEGORIZATION OF RESOURCES: The coal resources of India are available in older Gondwana Formations of peninsular India and younger Tertiary formations ofnortheastern region. Based on the results of Regional/ Promotional Exploration, where the boreholes are normally placed 1-2 Km apart, the resources are classified into ‘Indicated’ or ‘Inferred’ category. Subsequent Detailed Exploration in selected blocks, where boreholes are less than 400 meter apart, upgrades the resources into more reliable ‘Proved’ category. The Formation-wise and Category-wise coal resources of India as on 1.4.2010 are given in table below: (in Million Tonnes) Formation Gondwana Coals Tertiary Coals Total

Proved 113407.79 593.81 114001.60

Indicated Inferred 137371.76 33590.02 99.34 799.49* 137471.10 34389.51

Total 284369.57 1492.64 285862.21

* Includes 749.92 M.T. of Inferred resources established through mapping in NorthEastern region.

TYPE AND CATEGORY-WISE COAL RESOURCES OF INDIA :The Type and Category-wise coal resources of India as on 1.4.2011 are given in table below :- (in Million Tonnes) Type of Coal

Proved

Indicated

Inferred

Total

(A) Coking :Prime Coking

4614.35

698.71

0

5313.06

12572.52

12001.32

1880.23

26454.07

Semi-Coking

482.16

1003.29

221.68

1707.13

Sub-Total Coking

17669.03

13703.32

2101.91

33474.26

95738.76

12368.44

31488.11

250895.31

Medium Coking

(B) NonCoking:(C) Tertiary Coal Grand Total

593.81

99.34

799.49*

1492.64

114001.60

137471.10

34389.51

285862.21

* Includes 749.92 M.T. of Inferred resources established through mapping in NorthEastern region.

‘THE ENVIRONMENTAL PROBLEMS IN INDIA ARE GROWING RAPIDLY. THE INCREASING ECONOMIC DEVELOPMENT AND A RAPIDLY GROWING POPULATION THAT HAS TAKEN THE COUNTRY FROM 300 MILLION PEOPLE IN 1947 TO MORE THAN ONE BILLION PEOPLE TODAY IS PUTTING A STRAIN ON THE ENVIRONMENT, INFRASTRUCTURE, AND THE COUNTRY’S NATURAL RESOURCES.’ 42 MARCH/APRIL 2012 POWER INSIDER

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STATUS OF COAL RESOURCES IN INDIA DURING LAST FIVE YEARS: As a result of Regional, Promotional and Detailed Exploration by GSI, CMPDI and SCCL etc, the estimation of coal resources of India has reached to 267.21 Bt. The estimates of coal resources in the country during last 5 years are given below: (in Million Tones) As on

Geological Resources of Coal Proved

Indicated

Inferred

Total

1.1.2006

95866

119769

37666

253301

1.4.2007

99060

120177

38144

257381

1.4.2008

101829

124216

38490

264535

1.4.2009

105820

123470

37920

267210

1.4.2010

109798

130654

36358

276810

The environmental problems in India are growing rapidly. The increasing economic development and a rapidly growing population that has taken the country from 300 million people in 1947 to more than one billion people today is putting a strain on the environment, infrastructure, and the country’s natural resources. Industrial pollution, soil erosion, deforestation, rapid industrialization, urbanization, and land degradation are all worsening problems. Over exploitation of the country’s resources be it land or water and the industrialization process has resulted environmental degradation of resources.

Environmental pollution is one of the most serious problems facing humanity and other life forms on our planet today.

India’s per capita carbon dioxide emissions were roughly 3,000 pounds (1,360

kilograms) in 2007, according to the study. That’s small compared to China and the U.S., with 10,500 pounds (4,763 kilograms) and 42,500 pounds (19,278 kilograms) respectively that year. The study said that the European Union and Russia also have more emissions than India.

India has been ranked as seventh most environmentally hazardous country in the world by a new ranking released recently. The study is based on evaluation of “absolute” environment impact of 179 countries, whose data was available and has been done by researchers in Harvard, Princeton, Adelaide University and University of Singapore 0n January 12, 2011. Brazil was found to be worst on environmental indicators whereas Singapore was the best. United States was rated second worst and China was ranked third.

India and US clean energy pact: India and the U.S. on November 8, 2010 inked an agreement to establish a bilateral energy cooperation programme to promote clean and energy-efficient businesses, Indian and U.S. companies inked joint venture deals worth $175 million in the renewable energy sector.

The US President Barack Obama and Prime Minister Manmohan Singh announced the setting up of Joint Clean Energy Research and Development Centre. The proposed center is part of the Partnership to Advance Clean Energy (PACE), which forms the core of the “green partnership”. Funding for the center is expected from national budgets and the private sector. Each government proposes to commit $25 million over the next five years..

“Now the Indian consumer is increasingly conscious of the benefits of environmentally friendly and sustainable practices... 86% Indian consumers surveyed, place faith in energy efficient products and appliances, followed by recyclable packaging (79%),” Global Online Environment and Sustainability Survey by Nielsen said on August 29, 2011.

Coal pollution: India’s environmental problems are exacerbated by POWER INSIDER MARCH/APRIL 2012 43

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INDIA COAL

its heavy reliance on coal for power generation. “More than 80 per cent of energy is produced from coal, a fuel that emits a high amount of carbon and greenhouse gases.” said Bikash. According to him, coal pollution kills more than 300,000 people every year. Andhra Pradesh, the coastal state of eastern India is experiencing a coal-plant construction boom, including the 4,000-MW Krishnapatnam Ultra Mega Power Project, one of nine such massive projects in planning or under construction across the country.

On August 23, 2011 the Jharkhand State Pollution Control Board has ordered the closure of 22 BCCL mines in the underground fire zone of Jharia.

BCCL had taken over most of the 103 mines from private owners. Hence, none of them had got environmental clearances. Most of the coal mines under the JSPCB’s scanner were located in Jharia. The 2,640-MW Sompeta plant proposed by Nagarjuna Construction Company and the 2,640-MW Bhavanapadu plant proposed by East Coast Energy have both provoked large nonviolent protests that have ended in police attacks, including four deaths of local residents. As of May 2011, the Sompeta plant had been cancelled and the Bhavanapadu plant had been placed on hold by officials, with corruption investigations continuing.

On April 12, 2011 the Ministry of Environment and Forests (MoEF) has tightened pollution monitoring norms for power projects with a generation capacity of 500 Mw and above, integrated steel plants with a capacity of 1 million tonnes per annum and cement plants with a capacity of 3 million tonnes per annum.

Polluting industrial units: On May 26, 2011 the Haryana State Pollution Control Board has ordered closure of 639 polluting industrial units in 201011 and directed the highly polluting industries to set up continuous online monitoring stations to ensure compliance of standards of air emissions. The Government has launched prosecution against 151 polluting units in the Special Environment Courts in Faridabad and Kurukshetra, and made 9,239 units install pollution control devices.

Brick kilns are noxious sources of pollution: India’s 100,000 brick kilns are

noxious sources of pollution, particularly soot, and working them means a life that is always nasty, frequently brutish and often short. But on top of this social evil is an environmental one.

The exhaust from the kilns mixes with diesel emissions and other fumes to form a vast brown smog, known as an atmospheric brown cloud, which is up to 3km thick and thousands of kilometres long. Two of its main ingredients, the small carbon particles which the soot is composed of, and ozone, a triatomic form of oxygen, are important contributors to the greenhouse effect, and thus to climate change.

Among other negative effects, the cloud is therefore thought to be accelerating the retreat of Himalayan glaciers, which are found at a similar altitiude.

INDIAN SATELLITE TO MONITOR GREEN HOUSE EMISSION A dedicated satellite would be launched with the support of Indian Space Research Organisation (ISRO) by 2012 to monitor Indias greenhouse gas emission, Union Minister for Environment and Forests Jairam Ramesh said.

“Currently, Japan and European countries have this satellite but by 2012 we will have a dedicated satellite that will monitor greenhouse gas emission across the country and globe,” Ramesh said on March 13, 2010 at IIT-Powai.

“The objective is to study the impact of climate change, fallout of greenhouse gas emissions on the environment by monitoring it through satellite technology,” he said. Another satellite for protection and development of the forest cover in India would be ready by 2013.

“As the forests are getting depleted at a rapid pace elsewhere in the world, there seems to be a need for a satellite,” Ramesh said.

Pollution reduction strategy?

PROJECTS TO SAVE AGRA MONUMENTS BACK ON TRAC The growing threat from pollution to India’s prized monuments, including the Taj Mahal, has prompted the authorities to speed up action on March 22, 2011.

The project aims to insulate the world heritage monuments, including Fatehpur

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Exclusive LE Distributor for Indian Sub-Continent: Berkeley Petrochemicals Pvt Ltd, New Delhi www.berkeleypetrochemicals.com

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INDIA COAL Sikri, Agra Fort and the Taj Mahal. A set of eight schemes to control pollution and save these monuments has been submitted for clearance from the state government before being presented to the Planning Commission to include them in the 12th Five Year Plan (2012-2017).

WORLD BANK COOPERATION ON INDIA’S GREEN AGENDA India and the World Bank agreed on January 13, 2011 to further strengthen their partnership to advance India’s green-growth agenda. The Bank will now support to strengthen Indian capacity of Central Pollution Controls Board, State Pollution Control Boards and biodiversity conservation in addition to other various projects for which financial support have already been given.

INDIA TO BUILD ADVANCED COAL-FIRED POWER PLANT Indian scientists aim to built an advanced ultra-super critical coal-fired power plant in the next six years. Once realised, the plant is expected to put India in a very select group of nations having the technology which would reduce the amount of pollution when compared with the current thermal power plants.

GREEN COURT LAUNCHED India launched a “green” court on October 19, 2010 to make polluters pay damages as it steps up its policing of the country’s environmental laws.

Environment Minister Jairam Ramesh said India was only the third country in the world after Australia and New Zealand to set up such a tribunal. “This is the first body of its kind (in India) to apply the polluter pays principle and the principle of sustainable development,” Ramesh told reporters in New Delhi.

NATIONAL ACTION PLAN ON CLIMATE CHANGE The Centre has made a provision of Rs. 25,000 crore to mitigate the effects of climate change, a serious problem that India will face in the coming decades, Minister of State for Environment and Forests Jairam Ramesh told the Rajya Sabha on August 21, 2010. Besides, the Finance Ministry has also sanctioned Rs. 5,000 crore as recommended by the 13th Finance Commission to tackle this serious problem,” Mr. Ramesh said. About 220 scientists from 120 research institutions were working on assessing the impact of climate change on agriculture, water, health and forests.

STEPS IN BUDGET 2010-11 FOR THE ENVIRONMENT The increased pollution levels associated with industrialization and urbanization, a number of proactive steps have been proposed in the Union Budget (2010-11).

The major steps include: National Clean Energy Fund (NCEF) - for funding research and innovative projects in clean energy technology. Allocation for National Ganga River Basin Authority has been doubled in 2010-11 to Rs.500 crore. The “Mission Clean Ganga 2020” under the National Ganga River Basin Authority (NGRBA) with the objective that no untreated municipal sewage or industrial influent will be discharged into the National river has already been initiated.

BUT WHAT IS BEST, CARROT LIKE TAX INCENTIVES OR STICK LIKE PENALTIES? You need both. For environmental issues, incentives are good but you also need strong regulations. Good monitoring and reporting are crucial. You need incentives too, fiscal incentives, at times, subsidies, while promoting research and development. It’s not an either/or situation. Importantly, what you need is coherence between the federal government, state governments and municipal authorities. Companies exist in the local ecosystem - if you don’t have coherence, there’ll be laxity by the time you reach the local level.

The main problem with India and is plans, is at present their simply is no accountability. No body seems to understand exactly how these fines and taxes are collected, where they go or what happens to them! Most of public revenue ends up in private pockets or just needlessly and recklessly wasted. In a democracy, where social justice is the so-called rural employment guarantee, that guarantees regular inflow into the pockets of local netas and goons, where do ordinary Indians stand?

Time will tell!

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PI_JanFeb_Powergen_Ad.indd 1

20/02/2012 22:00

RAW COAL FEEDER TECHNOLOGY

MAINTENANCE FREE ROTARY GRAVIMETRIC RAW COAL FEEDERS IN POWER PLANTS INTRODUCTION: Today’s scenario justifiably lays emphasis on boiler efficiency and reduced emissions. Improved parameters are largely assisted by consistent accurate, uninterrupted, demand related, gravimetric coal feed to pulverizer.

Indian coal has high ash content frequently accompanied with foreign materials. This causes damage to rubber belts of conventional gravimetric feeders besides high wear of rotating parts. Further during monsoon season wet coal tends to be sticky and sluggish resulting in generation loss from flow problems in most power plants in India.

State of the art Rotary Gravimetric Raw Coal Feeder performs flawlessly even in these conditions, delivering consistent performance when compared with conventional belt type gravimetric feeders.

BRIEF HISTORY: Rotary weigh feeders were developed by FLSmidthPFISTER of Germany in early 1980s. Its simplicity, consistent accuracy and maintenance free operation resulted in its resounding success. Today the technology is preferred world wide for exacting and demanding weigh feeding application for improved process control and product quality.

First Rotary Gravimetric Feeder in Power Plants was introduced in India in 2003 at Kolaghat Thermal Power Station, replacing drag chain type volumetric feeder. Rotary feeder’s all metallic construction performed trouble free including during monsoons.

The undeniable advantage offered by rotary technology resulted in replacement of balance 5 feeders in the 210 MW Unit II in 2005/6. The feeders continue to deliver exceptionally since.

Based on benefits observed, these are installed in 4X210 MW Hasdeo Thermal Power Plant Korba West, Unit 6 Korba East bank, Unit 3 DVC Chandrapura, 300MW Durgapur Power Limited unit 7, 210MW Ropar Thermal Power Station Unit 1 and are under installation at NALCO Captive Power Plant and 210MW MAHAGENCO Chandrapur

Unit 3. It has a brilliant track record of 9 years of virtually maintenance free service in India.

BRIEF DETAILS: Manufacturer: FLSmidth-Pfister, Germany Model: TRW-K Type of Feeder: Rotary Gravimetric Feeder Application: Gravimetric Feeding of Crushed coal to Mill in PC Boilers Coal Crushed: 0-70 mm.

Lump size: Capable of handling lump size up to 200mm Capacity Range: Up to 150 TPH Feed Range: 10-100% Error: within + 0.5% Meeting NFPA 8503: Yes No of rotating parts: One – Slow Rotor normally limited to 3 to 4 rpm Construction: Totally Metallic – No drift in accuracy Electronics Location: Outside NFPA casing – Saved from Heat & Dust, Easy access for maintenance No. of Feeder Bearings: One - located outside NFPA casing.

No. of Feeder motors: One – Typically for 90100 TPH 3.7 KW rating – Power Saving Electronic Control: Can Process Interface (CPI) to Can System Controller (CSC) via Can Bus Interface with Plant Controls: Serial Interface (ModBus RTU), Network Interface (Profibus DP, DeviceNet), Analogue digital Hardwired Interface

COMPARISON WITH CONVENTIONAL BELT TECHNOLOGY: TRW-K is compact, robust and a closed design. A minimal number of moving parts and low number of machine components is in contact with crushed coal. Compared to conventional belt type, the rotary feeder is designed with: t No rubber parts - Burning coal can pass without causing damage t No belt - Wedge shaped foreign matter can cause

no damage t No pulleys - Energy efficient with only one motor t No idlers - No spillage t With only one shaft which is sealed by purge air No spillage scrapper This results in: t No drifting accuracy due to varying belt tension A CASE STUDY – 4X210 MW HASDEO TPS, KORBA WEST BANK: 4 units of 210MW were using volumetric feeders which were replaced. 24 Nos Rotary gravimetric feeders were commissioned between 2006/07.

Following has been observed during nearly 6 years of operation: t Not a single feeder opened for 4 years. No mechanical spares required during the period and negligible electronic maintenance t No choking during monsoon observed. Virtually no generation loss with wet sticky coal t No hammering of inlet chutes required to facilitate coal flow even with wet coal during monsoons. t No fire incident observed (due to metallic construction), even burning coal passes without any damage. t Foreign materials accompanying coal cause no costly damage and long feeder shut downs. t Maintenance friendly due to simple construction. t Since installation, this old plant is working over 90% plf t Maintenance issues of boiler have been observed to have reduced t Un-burnt component has been minimized both in bottom and fly ash t Always operated in gravimetric mode all these years and never needed to work in volumetric mode These are a few of the benefits observed post installation of the Rotary Gravimetric Feeders.

COMPACT DESIGN: Compact design of Rotary feeder offers potential for savings in layout. Seal height and feeder bay can be reduced.

In a large plant huge savings can be achieved. This should interest the EPC contractors in bringing costs down. Currently layouts are perforce designed for the minimum inlet to outlet offset of conventional belt type feeders.

It is evident rotary technology shifts performance, maintenance and savings paradigm for Gravimetric Feeders in Power Plants.

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NUCLEAR POWER

NUCLEAR POWER BACK FROM THE GRAVE?

BY CHARLIE FOX

A

year after one of the worst industrial disasters in history - the triple reactor meltdown and spent fuel fires at the Fukushima Daiichi nuclear power plant - we still don’t have a very clear idea about the full ecological, health and economic consequences facing Japan and the world.

Yet, while staggering amounts of radiation were released into the environment (the danger of new discharges lurks: even the plant director acknowledges that the reactors are “still rather fragile”), the global nuclear industry seems unfazed.

Its executives have good reasons to be cheerful, despite the gloom that had started to spread among them last year. The human lust for power - in the forms of cheap energy and nuclear weapons is unquenchable, and seems stronger even than the fear of death and collective destruction.

Meanwhile, alternative sources of such power beyond carbon fuels and nuclear energy, despite decades of efforts, are still underdeveloped.

Citing data that 60 countries were looking to jump on the nuclear bandwagon in 2011 and that four Asian countries (Vietnam, Bangladesh, the United Arab Emirates, and Turkey) are expected to start building their first reactors this year, on Thursday Japan Today ran the headline “Future of nuclear power brighter than ever, despite Fukushima.”

To be fair, modern societies need energy, and some of the alternatives to nuclear power are hardly better for the environment or for our own health.

The dilemma policymakers are facing was aptly captured in the title of a panel discussion that took place at New York University last November: “Global Warming or Nuclear Meltdown?”

In an essay published by Foreign Policy, Robert Dujarric argues that “we cannot expect renewables to ‘solve’ the energy question in the foreseeable future. ... Thus, though they seldom mention it, those who seek to abandon nuclear power are arguing in favor of greater reliance on fossil fuels.”

For many developing countries that import fossil fuels, much like for Japan until last year, nuclear power holds the promise of energy independence and prosperity. Others depend on their aging and unsafe reactors so much that in practice it is proving

impossible to shut them down (such is the case, for example, of Armenia, which is home to one of the world’s most dangerous nuclear power plants).

On the other hand, however, lurks the danger of nuclear catastrophe? A report published by the International Journal of Health Services, for example, claims that about 14,000 deaths “in excess of the expected” in the United States in the first 14 weeks after the disaster at Fukushima may be linked to the radioactive fallout from it. It was not possible to obtain similar statistics about Japan or any other country in the region, but given that the West Coast of the US, which is closest to Japan, is over 5,000 miles away, the conclusions should raise concerns.

According to the latest figures provided by the Japanese government, the combined death doll of the March 11, 2011 disaster is 15,853, with 3,283 missing. Most of these people, however, were killed by the magnitude 9 earthquake and the subsequent tsunami that triggered off the meltdown.

Both the government and the plant operator, Tokyo Electric Power Company (TEPCO), have often been accused of covering up the magnitude of the disaster over the past year. TEPCO announced in December that its workers had managed to achieve “cold shutdown” status of the inflicted reactors, meaning that the temperature of the cores had dropped below 100 degrees Centigrade. However,

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the cleanup of the site will take decades - up to 40 years, according to the current estimates. Tons of radioactive waste was reportedly bulldozed there.

Meanwhile, the danger of further contamination is not gone. “The biggest problem for the immediate future is the possibility of a severe aftershock earthquake,” said Arnold Gundersen, a former nuclear industry senior executive, in a recent Internet broadcast. “Tokyo Electric has calculated that if a severe earthquake hits, all of the jury-rigged piping that is in place will fail again, and within 40 hours we will be back to a meltdown. Now that is hardly stable.”

Even when a reactor has been turned off, the spent fuel continues to produce heat, and if the cooling system fails, a fire can start. Such fires can be as dangerous as nuclear meltdowns; this was demonstrated by the fire at reactor number 4 at the Fukushima Daiichi plant, which had been shut down prior to the tsunami, but the spent fuel caught fire several days into the crisis. Given that there were large amounts of spent fuel at all the reactors at the plant, we can expect Fukushima to remain a significant danger for decades.

A cleanup effort is underway in the towns and agricultural lands nearby (and much of the beach near the plant will be cemented over), but even the government has acknowledged that some areas remain permanently uninhabitable.

Meanwhile, comprehensive data about the contamination of either the atmosphere or the Pacific Ocean are not available, but most estimates indicate that Fukushima surpassed considerably a similar disaster at the Chernobyl plant in Ukraine in 1986.

For example, a study published in the Journal of Environmental Science and Technology shows that Fukushima polluted the ocean with a lot more radioactive chemicals than did Chernobyl. The peak releases occurred about a month after the accident, and at one point, on April 6, 2011, the levels of radioactive cesium near the plant were almost 50 million times higher than the normal background levels. At present, all but two of Japan’s 54 nuclear reactors are offline, and the others are expected to shut down within a few weeks. Given Japan’s dependence on nuclear energy (about 30% of the country’s electricity came from the nuclear power plants prior to the disaster), many experts expect at least some of the reactors to be restarted soon, after safety tests and improvements.

However, public opinion in the country has turned against nuclear power, and Prime Minister Yoshihiko Noda, who tried to advocate the above

‘ACCORDING TO THE LATEST FIGURES PROVIDED BY THE JAPANESE GOVERNMENT, THE COMBINED DEATH DOLL OF THE MARCH 11, 2011 DISASTER IS 15,853, WITH 3,283 MISSING. MOST OF THESE PEOPLE, HOWEVER, WERE KILLED BY THE MAGNITUDE 9 EARTHQUAKE AND THE SUBSEQUENT TSUNAMI THAT TRIGGERED OFF THE MELTDOWN.’ POWER INSIDER MARCH/APRIL 2012 51

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NUCLEAR POWER

path, is facing considerable resistance; in fact, he has also called for a gradual phasing out of nuclear power over several decades.

In a move fraught with symbolism, even the man who years ago convinced the former US president Ronald Reagan to allow Japan to process spent nuclear fuel into plutonium, feeding speculations that he was seeking a nuclear weapons capability, former Japanese Prime Minister Yasuhiro Nakasone, recanted after the disaster. “I want to make Japan into a solar power nation by skillfully using solar energy,” he told a solar energy conference, quoted by the newspaper Asahi Weekly.

“That statement by the 93-year-old who had long pushed nuclear energy as a national policy was an expression of a drastic change in energy policy even before any such move was even being considered by the opposition Liberal Democratic Party that he once led,” the article concludes. However, Japan and several other developed countries that are moving away from nuclear power - most notably Germany seem rather isolated in this endeavor. As mentioned above, most often the primary reason for this is the lack of good sustainable alternatives for the peaceful generation of electricity; however, in some cases the motivation is darker.

Consider for a moment the advice that a Chinese scholar, in his own account speaking to the Israeli daily Ha’aretz, gave to the Iranian ambassador in Beijing: “I suggested taking Japan’s route. Japan is a nuclear power. It has nuclear reactors and immense amounts of stockpiled plutonium and enriched uranium, but it has decided not to build nuclear weapons. Of course, it has the option to do so. If Japan wants to, it can build nuclear weapons within a very short time.” Estimates vary, but

according to the Asahi Weekly article cited above, Japan has stockpiles of plutonium sufficient to build 1,250 nuclear bombs. Indeed, Japan’s fuel recycling program, while never quite successful in recycling the fuel for energy purposes, has been the object of envy of several Asian countries for its potential military applications.

In an insightful analysis in Foreign Policy magazine, Henry Sokolski argues that the aftermath of the nuclear disaster in Japan is also a moment of opportunity for initiatives against nuclear proliferation: The weapons potential of this plutonium is an unspoken driver behind South Korea’s interest in getting into plutonium recycling, too. Seoul has long sought to keep up with every aspect of Japanese technology, including the most questionable and dangerous nuclear- and missile-related activities.

If Tokyo were to terminate its fast-breeder and commercial plutonium reprocessing efforts, it would

go a long way toward depriving Seoul of its argument.

We can assume that Iran is following the developments closely, as is North Korea along with a number of other countries in the region. Sokolski’s punch line, however, comes toward the end of the article, with the information that the Barack Obama administration itself is lobbying against legislation designed to impose better controls on exports of nuclear technology: Despite all the high-minded rhetoric about the importance of nonproliferation, it appears the White House attaches higher priority to nuclear sales in developing countries. Just last week, word leaked out that the administration is renewing talks to conclude a nuclear cooperation agreement with Saudi Arabia - even though Riyadh’s royals recently declared that Saudi Arabia was committed to acquiring nuclear weapons if Iran did.

Given that a nuclear arms race seems to have already started in the Middle East (and other parts of Asia), one has to wonder whether the US is entirely serious in its anti-proliferation efforts on the continent.

One of the broader lessons is, perhaps, that until disaster is brought intimately close to us - people in general - we seem unable to learn from it. It is true that the reactors where serious incidents have occurred have all been old and flawed; new designs are supposedly much safer and produce much less waste (even so, the thought of Bill Gates manufacturing “smaller, cheaper and safer” nuclear reactors might be a bit shocking).

However, in the long term, our reliance on a technology that is so harmful to us and to the environment will invariably carry risks that are too high to justify. This is, of course, assuming responsible use, which is hardly a very safe assumption.

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SMART GRIDS

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COMMUNICATIONS NEEDS OF SMART GRIDS, ELECTRIC VEHICLES AND RENEWABLE ENERGY S

BY CHRIS PAVOLWSKI

mart Grids are a recent initiative by the electricity industry to blend intelligence with the power distribution network, in order to observe electrical behaviour such as voltage, current, and power fluctuations. Existing electrical networks have largely been deployed with minimal remote monitoring and control. This lack of electronic oversight is suggested to contribute to inefficiencies in the distribution and use of electrical power. The Smart Grid involves the deployment of remote intelligent devices through-out the network so that accurate monitoring of the network may take place.

A smart grid has the potential to reduce repair time to network outages, improve the use of existing infrastructure, and reduce the carbon footprint of power generation. In particular, given the long term policy for many governmentsâ&#x20AC;&#x2122; world wide is to reduce emissions, carbon reduction is an important consideration. There are several other benefits in deploying a smart grid. This includes support for renewable energy sources at households, facilitating adoption of electrical vehicles, and increase customer awareness of impacts of excessive power consumption to the environment.

The key components of a smart grid involves the deployment of intelligent devices throughout the electrical distribution network, including smart meters to households. The intelligent devices and smart meters gather measurements such as voltage, current and power, together with network events and alarms and communicate this data back

to information technology systems that process, store and analyse the information. The enabling technology that supports this interaction is the deployment of telecommunications infrastructure to provide connectivity between devices and the information technology systems the gather, analyse and report upon this telemetry data.

Communications infrastructure often has to be deployed prior to implementing the IT systems and intelligent devices hence this poses an immediate challenge for those electrical distributors who do not have this in place. The current approach to address these communication needs has been through the use of both commercial 3rd party wireless and fixed telecommunication operators, or for the energy distributor to deploy their own infrastructure.

Electric vehicles are an emerging transportation technology which has the potential to reduce greenhouse gas and air pollution. Although electric vehicles may recharge from power that is generated from fossil fuel based generation plants, these vehicles may equally be charged through renewable energy sources such as photo-voltaic solar panels. The recent international calamity from the use of nuclear fuel as an energy source as further motivated the need to identify alternative sources. By using renewable energy such as photo-voltaic panels a significant carbon reduction is possible. However, in order to support electric vehicles several enhancements are required to the electricity network. This includes appropriate high-current recharge points at the household and fast recharging stations throughout the city and urban areas.

To support electric vehicles en mass a smart grid is required to manage and balance the significant increases in power distribution throughout the network.

While smart grids are an essential foundation in supporting electrical vehicles they are dependant upon a suitable communication infrastructure that provides connectivity for monitoring and control of a distribution network supporting renewable energy and electric vehicle recharging.

Several countries are embarking upon a wider scale deployment of national infrastructure to support broadband networking needs. The opportunity exists to leverage these communication infrastructure initiatives to accommodate the communication needs of a Smart Grid in a way that is able to support electric vehicle and renewable energy adoption nationwide.

The current communication deployments are largely targeting households for Internet connectivity however, the opportunity also exist to use the telecom technology in other ways. Moreover, communication channels are required for managing metering devices that support electric vehicle charging at households and to provide connectivity to commercial premises that provide electric vehicle fast re-charge services across urban and rural areas. For example, this is required to support the monitoring and control of the re-charging infrastructure, providing billing services, and facilitate optimal distribution of power for the network.

The Smart2020 report suggests that of the 50gig tons of CO2 emission generated globally smart grids have a capability to abate some two Giga-tons.1 The current estimate of the carbon emissions due to combustion engine vehicles is in the order of 7.3 Giga-tons.1 As such, world-wide a significant opportunity exists for global abatement programs that reduce carbon emissions through the combined use of electric vehicles, renewable energy, and smart grid networks. To enable the effective use of these combined technologies an underlying communications infrastructure is required to provide a reliable and secure channel for interconnecting the evolving smart grid.

By Chris Pavlovski, IBM Global Services Brisbane, 4000 QLD, Australia chris_pav@au1.ibm.com References GeSI Report, SMART 2020: Enabling the low carbon economy in the information age, Global e-sustainability initiative (GeSI), The Climate Group, 2008. Available at http://www.gesi.org/index.php

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SAUDI ARAMCO

SAUDI ARAMCO:

AN AMBITIOUS STORY OF DIVERSIFICATION O

il is a commodity that has been the stem of economic growth in Saudi Arabia since almost a century ago when Schuyler B. “Krug” Henry and J.W. “Soak” Hoover completed a survey and structural contour map of the Dammam Dome, the location of the first oil field discovery in Saudi Arabia.

The story of Saudi Aramco tells discovery and development of the greatest energy reserves the world has ever known and the rapid transformation of Saudi Arabia from desert kingdom to modern nation-state. From humble beginnings, the company has grown from an oil-producing company to a fully integrated, global energy enterprise with partnerships in every major continent.

Saudi Aramco has for many years and continues to rank first among oil companies worldwide in terms of crude oil production and exports, with stewardship over the world’s largest oil reserves - roughly one fifth of the global total at more than 260 billion barrels.

The Kingdoms oil fields are some of the largest on the planet, and the world relies on Saudi Aramco to manage them responsibly. It is no secret that global oil stocks are waning, which means an additional challenge in production strategies for expansive oil and gas reservoirs to have a 50 to 100 year time horizon, rather than just a decade or two.

In combination with primary upstream operations in oil, the company is also engaged in significant natural gas liquids (NGL) exports, and are among the leading producers of natural gas. Saudi Aramco are moving further downstream into chemicals production, the vision is nothing less than elevating the Kingdom’s chemical and mineral industries from

their current sound positions into world leaders in their enterprises, on parity with the countries oil.

An indication of commitment to this sector was recently made with the inception of a $20 billion dollar joint venture between the oil giant and U.S.based Dow Chemical Company, to launch a new business called Sadara. The integrated chemical complex will be based in Jubail, an industrial city in Saudi Arabia. When complete it will be the largest ever constructed in one single phase.

Sadara plans to produce 3 million tons of chemical products a year, and will focus on the local Saudi market, rather than the business of foreign exports. With ambition to make annual sales of $10 billion within a few years of operation, local market is expected to consume 20 to 30 percent of the company’s production during the first three years of business.

Current focus for the company is on expanding capability to discover, produce, process and transport natural gas. Efforts to explore for non-associated gas reserves, along with extensive projects to handle increased production, are expected to meet growing domestic demand for gas to fuel industries.

Saudi Aramco prides itself on serving essential infrastructure needs, such as power generation and water desalination; by providing natural gas feedstock.

Raw gas production capacity, operating at approximately 10.2 billion standard cubic feet per day (BSCFD) will be expanded to 15.5 BSCFD by 2015, by starting up gas increments at Khursaniyah (1 BSCFD, 2010), Karan (1.8 BSCFD, in stages from

2011-2013) and the Wasit Gas Plant (2.5 BSCFD, 2014). Accordingly sales gas production potential will increase from 7 BSCFD to 9.3 BSCFD. Despite ambitious ventures here, oil will continue to play a key role on the world’s energy scene for the foreseeable future. Saudi Aramco subscribes to the consensus view that oil demand will rise from about 86 million barrels per day currently, to between 105 and 110 million barrels per day by the year 2030.

Even if the share of oil and fossil fuels, fall in the energy mix over the coming years due to alternatives gradually gaining ground, the demand for oil and fossil fuels is expected to rise in absolute terms.

In response of the anticipated growth in oil demand and taking a long- term view of the business, the company recently completed an upstream expansion program that brought oil production capacity to 12 million barrels per day, with a spare capacity of roughly 4 million barrels per day. This spare capacity alone equals the exports of two typical large producers of oil and helps assure oil market stability during unforeseen circumstances.

Oil is a volatile business. This has been seen vividly during the past two years as the oil prices shot toward $150 per barrel; then fell below $35 as the world economy was hit by the financial and economic crises; and has since then recovered to exceed $80 per barrel. Oil exports remain the largest source of export revenue for the Kingdom. Depending on oil prices and export volumes, oil still accounts for 80 to 90 percent of total revenue. This major dependence on a single commodity is not desirable. This is why it is imperative to work hard on diversification and indeed transformation of the Saudi Arabian economy.

However, economies take time to transform.

Oil will continue to play a major role in the Kingdom’s economy for the medium term, which will undoubtedly be the next several decades, while industrialization steadily increases and economic diversification grows.

GHAWAR FIELDS Ghawar remains the world’s largest oil field 70 years after its discovery. Its size and continuity were not initially apparent, but a series of early exploration wells, now called the Magnificent Five, made apparent the work that was to be commenced and the role it had to play in Aramco’s phenomenal growth.

Ghawar helped catapult Saudi Arabia into its role as the world’s leading oil producer. The super-giant field is 280 kilometres in length and consists of five contiguous oil fields from north to south: Ain Dar, Shedgum, ‘Uthmaniyah, Hawiyah and Haradh

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Saudi Aramco has implemented the best-inclass reservoir management practices and leading technologies that have evolved over the years. As a result, the Magnificent Five have demonstrated extraordinary performance with extended lifecycles and outstanding oil recovery.

One of the first reservoir management initiatives was gas reinjection in Ain Dar. In 1958, King Saud ibn Abdulaziz inaugurated the gas injection facilities in Ain Dar. The primary purpose of the program was to re-inject produced gas to sustain reservoir pressure. Gas injection began in 1959 and continued for 20 years.

Water injection began in Ghawar in 1964 to provide additional pressure support — to maintain reservoir capacity to push oil to the surface. That technology, known as secondary recovery, provided a stepwise improvement in pressure support and began the displacement of oil from the outer edges of the Ghawar field toward the central regions to sustain oil production, as demonstrated by the exceptional performance of the discovery wells.

In 1997, a comprehensive 3-D seismic campaign was conducted across the Ghawar field. The seismic profiles provided vital information on reservoir structure and distribution of fractures, guiding development and recompletions across Ghawar.

That information, for example, was used to guide

the placement of the horizontal well trajectory for Shedgum No. 1.

The Ghawar discovery wells, Ain Dar No. 1, Shedgum No. 1, Haradh No. 1 and Hawiyah No. 1 are still producing today with the original well casings. That speaks to the quality of workmanship and materials that went into the original wells.

Altogether, the wells have produced more than 50 barrels of oil. There is no telling how much more they will produce — as the end of their story is not yet in sight.

MODERN DAY INNOVATION Saudi Aramco are also currently operating two largescale Maintain Potential Programs, one offshore and the other onshore. The goal of these projects is to sustain oil production capacity by ensuring existing fields perform to their best for as long as possible.

The onshore connection program comprised of 84 new oil and water injection wells, increasing oil production capacity by more than 230,000 bpd.

The offshore program included the installation and integration down-hole instrumentation, multiphase flow meters and remote terminal units on 60 existing offshore production platforms, in addition to the completion of the critical Safaniya crude oil trunk-line system. Implementing intelligent field technologies allows for real-time decision making, greatly improving remote reservoir management, which enables the production of hydrocarbon resources in an effective and efficent nature.

Other exciting areas for Innovation-powered progress include the publishing of a world’s first scientific paper for 3D modeling of three-phase (gasoil-water) separation flows, by scientists from the Aramco Research & Development Center.

Soon to follow their paper was transformation into an actual simulation inside a full-size gas-oil separation vessel, using a hundred million cell model.

This provided the first detailed flow analysis of a large gas-oil separation vessel. This exciting achievement is an important step in using computational fluid dynamics to improve the performance of crude oil separation facilities.

Saudi Aramco has been producing oil and gas from its giant fields for an extended period. Over this time, some of these giant fields have been developed to such an extent that they have matured into brown fields. As is done with most brown field developments, Saudi Aramco engineers are continuously striving to push and extend the economic productive life of these fields, by the deployment of cost-effective, low risk technologies.

One such cost-effective measure employed by Saudi Aramco engineers is the work over re-entry of some existing producing wells, either to re-complete the next zone in the well, or to sidetrack and extend the well’s reach to an existing attic fluid elsewhere in the reservoir subsurface structure. Sidetracking an existing well is often challenging, as it requires the drilling of hole sizes smaller than the well diameter at the sidetracking point.

The provision of slim hole logging services has created an opportunity in the industry to leverage these tools for the economic development of brown fields. Therefore, short horizontal sidetracks and well re-entries to test deeper horizons can be drilled and logged successfully. Saudi Aramco has been able to leverage these tools in its continued development of the giant Ghawar field.

NEW CAPACITY AND EXPANSION; RISE OF THE SHAYBAH FIELDS In additon to enhanced oil recovery and well extension, contiuned exploration and new facility capacity is critical in the companies continued growth. The pinnacle of the Aramco capital investment program is the Khurais project. As the largest single crude oil increment in the company’s history, Khurais recently added 1.2 million barrels per day of Arabian Light crude oil production capacity.

The Khurais increment, which includes the development of the Abu Jifan and Mazalij fields, began crude oil production in June 2009. Its gas facilities treat the associated gas produced, and have the capacity to handle 70,000 bpd of condensate POWER INSIDER MARCH/APRIL 2012 57

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SAUDI ARAMCO

and 320 million scfd of gas.

Other major oil projects included Abu Hadriya, Fadhili and Khursaniyah, and combined together they contributed a total of 500,000 bpd of blended Arabian Light crude oil production capacity.

Another recent benchmark includes the Shaybah Expansion. The field is Saudi Aramco’s most remote oilfield, located in the south eastern section of the Kingdom. In June 2009, the facility was upgraded to produce from 500,000 bpd to 750,000 bpd of Arabian Extra Light crude.

The new expansion is expected to boost production further to 1 million bpd and increase the gas-oil ratio (GOR) of the field from 1,800 to 7,200 standard cubic feet per stock tank barrel.

Four engineering, procurement, and construction packages worth $2.76 billion for the Shaybah Natural Gas Liquids (NGL) Recovery Program were handed to South Korean players Samsung Engineering. The first package is for the inlet and gas treatment facility, which will remove impurities such as sulphur from the gas. The second package is for the NGL recovery and utility facilities, and the third package is for the construction of the co-generation plant to produce power for the facility. The fourth package is for the gas and oil separation plants. All packages will be completed on a lump-sum turnkey basis and are scheduled for commissioning by mid-2014.

America’s General Electric where selected for the supply of key components such as gas turbines and compressors for the expansion. With the recent opening of the GE Energy Manufacturing Technology Centre in Dammam it signifies the importance of international cooperation for continued advanced manufacturing and presents opportunities to provide young Saudi talent with

the skills and qualifications to contribute to the Kingdom’s growing energy sector.

Energy efficiency in Aramco + Massachusetts Institute of Technology Energy Initiative Saudi Aramco some 13 years ago undertook a rigorous examination of energy efficiency and productivity. In respect of findings action has been taken on areas where learning’s have demonstrated a needed improvement. An important example of this is the co-generation of electric power and process steam, at facilities where formerly power was drawn from the national electricity grid. Recent Aramco cogeneration projects include the production of 4.4 million lb/h of steam at Uthmaniyah, Shedgum, Ras Tanura and Ju’aymah.

Since the inception of Saudi Aramco’s Energy Management Program in 2000, the company alone has realized fuel savings equivalent to 71 thousand barrels of oil per day.

Another great example of this is the Oil to Chemicals (OTC) project, run by the Aramco Research and Development Centre (R&DC).

This project is playing a key role in enhancing the chemicals business by developing High-Severity Fluid Catalytic Cracking (HS-FCC) technology.

By converting low value, heavy gas oils into higher value olefins and aromatics feedstock, HS-FCC is helping to economically produce more products from oil. After conversion, the olefins and aromatics are suitable for integrated petrochemical processes, or for the use in the production of high octane gasoline. Also in development are downer-based enhancements that can be attached to existing Fluid Catalytic Cracking (FCC) units which will enable the cracking of naphtha and vacuum gas oil.

The Kingdom welcomes opportunities to share with others in the best practices learned in energy efficiency. There is much more that everyone can do, for example in public awareness campaigns, in improving the energy efficiency of new residential and commercial buildings, in the energy efficiency of appliances and equipment, and in enhancing the mileage efficiency of the Kingdom’s fleet of vehicles.

Saudi Aramco also recently joined the Massachusetts Institute of Technology Energy Initiative (MITEI) as a sustaining member. The five-year alliance will support MITEI’s research and development of new energy technologies and

improve processing techniques for cleaner fuels.

Established in 2006, MITEI brings together top researchers from MIT and the business sector to launch new initiatives focused on energy security, clean-fuel technologies and education.

As a sustaining member, Saudi Aramco will have a seat on the MITEI governing board, which provides key input into the initiative’s research portfolio. Saudi Aramco’s participation will also allow the company to work through MITEI to conduct customized research that supports R&DC’s priorities.

Two research projects currently under way are “Whole Crude Oil Desulfurization by Supercritical Water,” and “Bioprocess Engineering on Microbial Desulfurization.”

In the desert Kingdom, conserving energy also contributes to something as precious as life itself: the water supply. Saudi Arabia is the world’s leading producer of desalinated seawater, the processing of which is particularly energy intensive. Any technological breakthrough that would reduce the BTUs consumed to desalinate water would be immensely valuable to the domestic economy.

The challenge of making desalination more efficient is one of the more exciting strategic opportunities for enterprising researchers. Another profoundly important aim for the long-term future of the sun-drenched land is developing the potential for solar energy. Both King Abdulaziz City for Science and Technology (KACST) and King Abdullah University of Science and Technology (KAUST) are now engaged in research on water desalination and solar power, and KACST recently announced collaboration with IBM to build a solar desalination plant to serve 100,000 people in Al Khafji. The new, energy efficient plant will have an expected production capacity of 30,000 cubic meters per day and will be powered by ultra-high concentrator photovoltaic (UHCPV) technology.

With efforts such as these, the day is not too far away for real breakthroughs in these fields. Moreover, recent announcements of the establishment of the King Abdullah Nuclear and Renewable Energy City in Riyadh adds yet another dimension to the Kingdom’s determination to make the most of its energy potential, increase international cooperation for technology and continue diversification.

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3/20/2012 9:19:23 AM 04/04/2012 10:56

COOLING SYSTEMS

GREENER COOLING SYSTEMS AS ECONOMIC CHOICE

BY ZOLTÁN SZABÓ (GEA EGI, HUNGARY)

I

mportance of selecting cooling systems based on comprehensive analyses Proven water conserving power cooling solutions – direct ACC, indirect HELLER System & their dry/wet variants – have been available for decades.

In spite of continuous technical development in the field and shrinking water resources at the other side, their application remained way behind the conventional water thirsty cooling methods (once-through or wet cooling). Non-realistically low water entitlement and blow-down disposal fees combined with in lack of proper information about the economic consequences of applying either water saving or using solutions help to preserve the status quo.

The combined cycle block was considered for European continental climate (average ambient temperature: 11.9 °C, ranging from -20 °C to 40 °C).

The following variants were investigated: t var. A: HELLER System all-dry t var. B: HELLER System with Supplemental Spraying t var. C.: HELLER System with Wet Assisting Cells (separate dry and wet circuits) t var. D: Direct ACC t var. E: Wet cooling The HELLER related indirect systems (var. A; B; C) were considered with natural draft, whereas the direct ACC (var. D) with mechanical draft, since no proven natural draft solution is available for it.

Fig 1: 540 MWe Nasserieh CCPP with HELLER System, Syria – Owner: PEEGT, EPC: Siemens

Decision for a wet cooling system now has lasting effects. It influences not only the economics of the power plant itself (through making dependent the stability of electricity production on long term water availability), but also influences the surrounding region environmentally and economically by depriving the other sectors (agriculture or industrial processes) of water use for 3-5 decades, the whole life-span of the power plant.

The best is to base decision on a comprehensive evaluation comparing the most promising cooling system options for a new power plant. Such an evaluation shall have some vital features: Cooling systems shall be regarded as an integral part of the power cycle; therefore in every sense their impact on the complete power plant is to be investigated.

It shall be a comparative analysis considering besides the evaporative cooling system also the different water conservation ones and investigating their technical aspects, thermal capabilities, environmental effects and economics.

The economic evaluation shall be a present value based economic life cycle cost analysis taking into account alongside the investment also costs from operation, maintenance and differences from equivalent unavailability.

RESULTS OF AN EXEMPLARY CASE STUDY GEA EGI has made contributions to a number of comprehensive evaluations aiming at selecting cooling systems – mainly for would-be power plant owners – many of those have been implemented since. Summarized results of such an investigation are introduced herein for evaluating and comparing cooling system serving an 800 MWe combined cycle power plant (CCPP).

Fig 2: 3×800 MWe Gebze & Adapazari CCPP with HELLER System, Turkey – Owner: Enka, EPC: Bechtel/Enka World Record Availability 2011 (Power magazine, Sept 2011)

TECHNICAL & THERMAL ASPECTS The effects of the cooling systems’ characteristics on power output, year-round electricity generation auxiliary power and water consumptions and the equivalent unavailability are particularly important parts of the technical investigation.

Combining the heat input variation from the HRSG into the steam cycle (heat input vs. ambient temperature), and the power cycle characteristics (turbine output & heat to be rejected vs. backpressure) with cooling system characteristics the cold-end (turbine back-pressure vs. ambient temperature) and power output vs. ambient temperature characteristics can be developed.

These characteristics provide basis to determine the impact of the cooling system on the power output and cooling water make-up requirement at any ambient temperatures and load conditions.

Then considering the yearly ambient temperature duration curves (or alternatively temperature durations for any selected periods) and the above mentioned characteristics the annual gross electricity generation and water consumption can be determined. Deducting the cooling system auxiliary

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COOLING SYSTEMS consumptions (also taking into account their variations) provides the annual “net” electricity generation figures for the power cycles equipped with different cooling systems (Table 1).

Year-round Technical Results (7008 h/ year)

VAR A

VAR B

VAR C

VAR D

VAR E

DD HELLER dry

HELLER sprayed

HELLER wet assisted

Direct ACC

Wet cooling

1911.324

1914.442

1930.045

1881.921

1956.283

Average Net”* Output (MWe)

272.73

273.18

275.41

268.54

279.15

Annual Water

-

56

373

-

4389

Annual Net”* Electricity Generation (GWeh / year)

Table 1: Annual average turbine output, electricity generation and water consumption of the investigated CCPP steam cycle equipped with different cooling systems

Compared to the wet cooling, the annual electricity production with dry HELLER System (var. A) is smaller by 2.3%. This difference is reduced to 1.3% with a wet assisted HELLER System (var. C) on cost of only 8.5% annual water consumption referred to that of the all wet system. Increasing the annual water consumption of the dry/wet HELLER System to 25% the difference in annual electricity production can be reduced to 0.5%. The wet/dry HELLER Systems provide high operational flexibility adapting the electricity production & water consumption seasonally, daily and hourly to the water availability and price on one hand and to the electricity requirement on the other hand.

The power cycle equipped with an all-dry HELLER System – due to its natural draft – generates 1.56% more electricity on year-round basis than the same unit equipped with direct ACC, the other all-dry cooling system (what exists only with mechanical draft).

It is essential to make reliable prediction to the required maintenance and the equivalent unavailability differences directly those of the cooling systems and caused indirectly by them on the power plant. The maintenance and equivalent unavailability factors are assessed on the basis of experiences and statistics

Dry and dry/wet cooling systems significantly reduce site selection dependence on water sources. Within the site itself the location of the direct ACC shall be as close to the turbine hall as possible, whereas indirect dry cooling offers much more locating flexibility. Dry/wet cooling systems support outstanding operational flexibility for the power cycle.

ENVIRONMENTAL ASPECTS To evaluate the environmental impact of the cooling systems the following main issues worthwhile to be considered: t Cooling water withdrawal / consumption and quantity of polluted water discharge: For water consumption of the investigated cooling systems see Table 1. t Pollutant emissions by the cooling medium (air) Wet cooling plant emits visual vapor plume together with carryover droplets having some salt and other chemical contaminants. Whereas all dry cooling systems emit only warmed-up dry air. Emission by dry/wet systems also is negligible to those of wet cooling plants. t CO2 and pollutant emissions by flue gases and their ground level concentrations Considering same electricity production the emissions are proportional with the reverse of the efficiencies (information can be taken from data in Table 1).

The ground-level concentration of pollutants could dramatically be reduced if natural draft is applied and the flue gases exhausted through the tower. This solution was not applied in the present case because its importance negligible for combined cycles, however it has major advantage in case of coal fired power plants (e.g. at the BaoJi PS – see Fig 4 – the complete FGD-plant is located within the natural draft dry HELLER tower, thus cleaned flue gases are rejected via the tower through a short stack on top of FGD). t Noise emission by cooling system (and the area occupied by noise above a limit value around the investigated power cycle as a whole): The smallest noise emitted by the natural draft HELLER System (noise by its tower is practically zero; the only source of noise is CW pumps and hydroturbines). Impacts of HELLER System and the direct ACC on the noise emission of the investigated 800 MWe CCPP is shown by Fig 3. Area occupied by noise over 45 dB(A) is only 54 ha if HELLER System is applied, compared to 90 ha in case of direct ACC.

Fig 3: Impact of cooling systems on the 800 MWe CCPP noise emission (areas occupied by different sound pressure levels around the power plant)

VISUAL IMPACT OF THE COOLING SYSTEM: Wet cooling has a low structural visibility, if it is a mechanical draft one, though its visual impact because of the wet plume may be relatively large. The mechanical draft direct ACC is a low key plant without any plume. The natural draft HELLER Systems need high superstructure (also without any plume), thus visual impact is their only environmental drawback.

received from and discussed with power plant owners and operators – thoroughly considering some essential cooling plant features and operational circumstances.

Such features shall be taken into account like cleanliness of medium to be cooled, type of air moving equipment (natural or mechanical draft), dry or wet cooling air, existence of sectionalized heat dissipation surfaces and their cleaning method etc. E.g. obviously dry cooling with natural draft has a major advantage over mechanical draft, as well as cleanliness of the medium to be cooled in dry cooled systems when compared to the wet cooled ones.

Siting and operational flexibilities represent further important technical aspects.

HELLER Systems for coal fired Chinese power plants: 2×660 MWe Shuidonggou PS

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Fig 7: Economic viability envelopes showing borderlines between economics of wet cooling vs. water conserving cooling systems of different type

3×660 MWe BaoJi Supercritical PS; with FGD-in-tower

ECONOMIC ASPECTS Results of present value based life cycle economic assessment of the investigated cooling systems serving the 800 MWe CCPP are introduced in Fig 6 (present value gains or costs are shown relative to the all-dry natural draft HELLER System, var.

A as a basis). A remarkable cost reduction could be achieved by the dry HELLER System compared to wet cooling (var. E) at the actual project related water & electricity prices (0.6 €/m3 & 42 €/MWh). The gain can be even further improved by its dry/wet derivatives (var. B & var. C).

LESSONS OF COMPREHENSIVE COOLING SYSTEM EVALUATIONS Power project type & size, climatic conditions, site circumstances and economic conditions all may influence the results. Therefore the information gained through a particular evaluation cannot automatically be generalized, whereas the series of investigations made by GEA EGI lay out certain trends. t The different dry cooling solutions and their dry/wet derivatives have successfully demonstrated their reliability and effectiveness. Given the long-lasting impact of the choice of a cooling method for a power plant and even on the surrounding area, it is advisable to make a comprehensive evaluation (including present value based economic lifecycle comparison) to support decision. t A natural draft HELLER System for medium and large capacity power projects is economically superior on present value terms to any mechanical draft dry cooling under all practical conditions. t Evaluations show how the advanced natural draft HELLER System extends the economic viability of water conserving cooling. It can be competitive on present value basis against wet cooling even at a medium cooling water makeup cost. t Natural draft for the indirect HELLER System not only brings in substantial reduction in auxiliary power consumption, but also supports outstanding cooling system-and power plant reliability & availability as well as needs minimum maintenance. t Dry / wet HELLER System derivatives can further improve economics and additionally ensure high operational flexibility including opportunity to harmonize between water use and electricity production depending on their varying actual values.

REFERENCES [1] Szabó, Z., No Green Nuclear Power without Green Cooling Systems, Paper presented at the China nuclear Power Leadership Summit, September 2010, Guangzhou, China [2] Balogh, A., Szabó, Z., Heller System: The Economical Substitute for Wet Cooling, November 2009, Power Plant Chemistry [3] Hogan, M., The Secret to Low-Water-Use, High-Efficiency Concentrating Solar Power, Climate Progress, April 2009, http://www.worldchanging.com/archives/009802. html [4] Balogh, A., Szabó, Z., Heller System: The Economical Substitute for Wet Cooling – to avoid casting a shadow upon the sky, EPRI Workshop on Advanced Thermal Electric Power Cooling Technologies, July 2008, Charlotte (NC) [5] Szabó, Z., Cool for Coal, Journal of Power & Energy 1st quarter, 2004 – Asia Pacific Developmen

Fig 6: Present value based cost differences referred as basis to the dry HELLER System (var. A)

It is worthwhile to make sensitivity analysis for determining how changes of economic factors influence the results. A so-called economic viability envelope (coordinates of two vital factors: water and electricity prices) is introduced here – which helps to judge financial stability of cooling systems relative to wet cooling in view of potential changes of these factors (Fig. 7).

The all-dry HELLER System (var. A) at the project actual electricity selling price of 42 €/MWh reaches the break-even water cost against the wet cooling at 0.43 €/m3 for the investigated project. On the other hand, the dry Heller System at the project actual water price of 0.6 €/m3 is competitive against wet cooling (var.

E) up to 63.5 €/MWh electricity selling price – i.e. well over the project actual 42 €/MWh. The wet assisted Heller System (var. C) extends further (to approx. 90 €/ MWh) the break-even electricity price.

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FUEL CELL TECHNOLOGY

FUEL CELL DEVELOPMENT AND TECHNOLOGY U

nlike other economies with a fledgling automotive industry, which for a century have always focused more on job creation than pollution, China ambitiously sets a goal for the best and newest industry, aiming for pollution reduction and energy savings. A visit by Chinese President Hu Jintao resulted in a memorandum of understanding that might lead to a longer-term contract between Ballard Power Systems (part-owned by Daimler Chrysler AG and Ford Motor Co.) and Shanghai Fuel Cell Vehicle Powertrain Co.; the Shanghai government expects to see about 10,000 fuel-cell vehicles on the road by 2012. Many analysts believe that a centralgoverned economy like China’s is in effect more likely to develop a sound infrastructure for fuel-cell technology, given its aggressive scheme and devotion to the project. While waiting for the infrastructure to be developed, Shanghai’s Horizon Fuel Cell Technologies pursued the big dream by starting with small projects: fuel-cell toy cars. The retail started in July 2006. The company is hoping to expand into making fuel cells to power cell phones and laptops, although the ultimate goal would be vehicles and household electronics.

China is currently the world’s second largest energy consumer and producer. Since the opening of Chinese markets in the 1990s, rising private wealth

amongst the population has resulted in an increased demand for cheap electricity and private and public transport. Since the pollution from a growing number of vehicles creates smog in many Chinese cities, which is among the worst in the world, the pressure to develop clean vehicle technologies is mounting. In this respect, China is in a similar position to many other newly industrialized countries. Furthermore, China’s oil reserves are limited. Until 1993, the country was a net crude oil exporter but since then oil imports have increased sharply to over 75 million tons in 2000. China’s oil import in 2004 was 122.7 million tons, an increase of 71%, as Chinese consumption has continued to surge higher. Experts also predict China’s oil imports could increase at a rate of about 30 percent for the next 3 years. This level of imports could cause financial problems for the country and also could stimulate inflation.

Additionally, the demand for alternative fuels in China is driven by the Chinese government’s desire to reduce air pollution (China is already the World’s second largest producer of carbon dioxide emission after the U.S.), particularly in urban centers. China has six of the world’s 10 most-polluted cities. The Chinese government has set a time line to improve emission standards for vehicles in China. China’s National Development and Reform Commission

(NDRC) has also issued a new Automotive Industry Development Policy. The new policy, which became effective on June 1, 2004, stipulates that average fuel consumption of new cars should be reduced by 15% by the year 2010.

FUEL CELLS PROJECTS Transportation is considered to be the most important initial market for fuel cells in China. The market for replacing batteries in electric bicycles is expected to be the earliest market to be commercialized, followed by buses. Approximately 1 million buses were produced in China in 2002. This was an increase of 25% over production in 2001. Seventy-four percent of the application of fuel cells in China focuses on transportation. Fifty-four percent of fuel cell technology in China is based on proton exchange membrane fuel cell (PEMFC), the most prominent fuel cell technology for transportation applications worldwide.

China hasn’t seen much private investment in this sector. Up to 2003, only a handful of private Chinese companies are working on the issue. However, China has seen vast investments from major car and bicycle manufacturers, some of which are already working with local research institutions on fuel cell applications. But hydrogen fuel cell power has daunting technological

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hurdles that must be overcome before they can help solve pollution or energy challenges. Fuel cells are still extremely expensive and in transportation applications fuel cells are still very fragile. Storing and distributing hydrogen is still difficult, because hydrogen as a gas contains very little energy by volume, and therefore must be either liquefied or stored under extreme pressure in order to deliver meaningful amounts of energy. Finally, hydrogen itself must be extracted from other fossil fuels, or manufactured using electricity and water. So even if hydrogen becomes the clean energy of choice, hydrogen will have to be manufactured using other fuels.

Today, China hosts more than 60 institutions and companies, employing around 350 people working on the technology. As shown in the above figure, most of these organizations are still very much research orientated.

China’s ample market and the current limited development in fuel cell technology indicate a lucrative market to foreign investors of this sector. The main opportunities for fuel cell technologies in China are in the development of prototypes of fuel cell engines and for fuel cell fuelling stations. Chinese transport authorities are looking for well-designed buses that suit their individual local environments, maintenance staff training and a high level of service. At the moment, there are two major state technology programs related to fuel cells and hydrogen research in China and some initiatives and projects, partly-funded by the government.

China’s Ministry of Science and Technology has also revealed their intention to expand research on fuel cell and alternative energy with large investments into related an R&D program.

JAPAN LEADS THE RACE FOR A HYDROGEN FUEL-CELL CAR? Japanese carmakers, such as Toyota, are developing an affordable hydrogen car using fuel cells. Meanwhile, the government and energy companies are funding hydrogen refueling stations needed for the cars’ widespread use.

It may still sound like science fiction to some.

But Japan is taking a lead in making zero-emissions hydrogen-fueled cars a reality.

It’s part of the country’s aspiration to cut its carbon emissions 80 percent by 2050; nearly a quarter of those emissions come from transportation. And it’s a more urgent task in a country that imports all of its oil.

Japan leads Asia in early hydrogen-car infrastructure and is a world-beater in emerging fuel cell technologies.

“Hydrogen is still in very, very early days,” cautions Ashvin Chotai, London-based managing director of Intelligence Automotive Asia. “But in the area of green cars, Japan has been investing a lot further ahead than the Western companies in the last few years, and they have an edge.”

Take Toyota. Last year they announced they hope to retail an “affordable” fuel-cell car by 2015. It would be next step toward what the firm calls the “ultimate eco-car,” after today’s popular hybrids like the Prius, the “plug-in” hybrids that just came on the market, and fully electric vehicles.

Long term, Toyota sees hydrogen-fueled cars as ideal for long-haul driving, with plug-in hybrids

better for mid-range driving and electrics best for short-range commuting.

That’s because fuel-cell cars have a much longer range from one fueling: more than 500 miles already, in a test run of a Toyota vehicle last year in Japan, compared to a maximum 125-mile per charge range with electric vehicles.

BUILDING HYDROGEN HIGHWAYS But as with electric vehicles, the biggest hurdle is a lack of power stations. “Fueling infrastructure is the joker in the whole thing,” says Toyota spokesman Paul Nolasco. “You can’t have fuel cell vehicles without the infrastructure, and you can’t have infrastructure without fuel cell vehicles.”

The Japanese government is stepping in to address that chicken-and-egg problem. It’s subsidizing fuel cell development and collaborating closely with energy and auto companies to build Japan’s “hydrogen highway” of the future.

The government has subsidized 13 hydrogen stations for fuel-cell cars, covering at least half of the $5 million to $6 million per station cost, according to the Fuel Cell Commercialization Conference of Japan (energy firms have ponied up the rest). It hopes to build 40 to 50 more by 2015.

Japanese energy firms are actively working together with the government to build the hydrogen car infrastructure. Tomohide Satomi, of the Fuel Cell Commercialization Conference of Japan, says such firms are looking into the future and seeing a need to develop new products as gas sales decrease.

“To survive, they have to change the portfolio of their energy supply business,” Mr. Satomi says. “So they’re looking to the future. They have to seek new business areas besides gasoline.”

He says Japan’s hydrogen highway efforts are on par with those in the United States (particularly California) and Germany, and that it leads Asia, with South Korea close behind.

NOT CHEAP, OR 100 PERCENT CLEAN At one such station in a harbor-side, industrial area of Yokohama City, the Japan Automobile Research Institute’s Hideaki Matsushita showed off a fuel-cell demo model from Toyota. After a test drive, the car came to rest and a pool of water puddled under the exhaust pipe.

In fuel-cell vehicles, hydrogen fuel and oxygen

flow over a fuel cell stack, producing the electricity that runs the motor; the byproduct is water. It’s not a 100 percent “clean” energy source: currently one of the cheapest ways to produce hydrogen fuel uses natural gas.

Producing such fuel by “electrolysis” (combining electricity and water to create hydrogen) is the Holy Grail of green vehicles, but that’s an exorbitant process for now.

At the Yokohama demo station, it’s clear that fuelcell vehicles aren’t quite ready for prime time. The ideal customer is a millionaire – and a bodybuilder.

For safety reasons, the pumping of high-pressure hydrogen fuel requires a heavy, rugged case and nozzle. A mechanical arm helps lift the nozzle to the car for fueling.

And a typical fuel-cell vehicle goes for about $1 million, according to Sayaka Shishido, of NEDO, the government’s funding arm for fuel cell and other “new energy” development projects. Toyota leases its 14 fuel-cell vehicles in Japan for a cool $9,000 to $11,000 per month, to universities and local governments.

TARGET YEAR: 2015 Ten years ago, the Japanese government hoped to have five million fuel cell cars on the roads by now.

Satomi said that cost and durability issues were greatly underestimated.

The new goal is more realistic, with a focus on building the necessary infrastructure for very smallscale commercialization by 2015.

Aside from infrastructure, other technical hurdles remain. One focus now is reducing the amount of expensive platinum used in each car. Many fuel cell vehicles now use around 100 grams; the goal is to whittle that down to just 10 grams.

Toyota says it’s making progress: It has doubled the capacity of its hydrogen tanks in the past year, and sharply reduced the platinum it uses per car, to under 50 grams.

NEDO is funding research on reducing costs and improving fuel-cell durability. And it’s confident about its commercialization targets, because auto and energy companies are on board.

“2015 – that will be the key year for Japan,” says NEDO’s Ms. Shishido. “This will be the starting year for utilization of fuel-cell vehicles by the general public.”

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ACTUATOR PERFORMANCE

ACTUATOR PERFORMANCE SIGNIFICANTLY IMPACTS BOILER CONTROL & PLANT PERFORMANCE H

arold Beck and Sons, Incorporated has been manufacturing electric actuators since 1936. The unique design of Beck actuators has made them a standard for modulating damper and valve applications in the North American power industry. This design is specially suited for precision modulation and control without duty-cycle limitations or high maintenance requirements. The better, more reliable actuator performance results in better, more efficient boiler control with far fewer unplanned outages. Simple actuator improvements can result in significant rewards as has been shown in studies like the one done by the Electric Power Research Institute (EPRI) in the US at the TVA, Kingston plant.

Today, Beck has expanded world-wide with growing representation around the Globe. The boiler control improvements driving Beckâ&#x20AC;&#x2122;s success in the US power industry are equally applicable to the rapidly growing Asian power market. The advantages of better actuation are universal.

TRADITIONAL ACTUATOR PROBLEMS: There is no shortage of instrumentation and control technology available today, and power plants make significant investments in this equipment. Often overlooked when making investments in plant control equipment, however, is the necessity of precise, reliable actuator response. Actuators are often considered with little thought to how they respond to the controller and how their performance and reliability can limit the control system performance and plant reliability.

Actuator selections are too often made based on purchase price considerations only. This is a short term approach that can have costly results. Typical actuator designs have a number of deficiencies that can cause boiler control problems that lead to inefficient combustion, poor emissions control, boiler trips and unplanned outages, thermal stress, and high maintenance expenditures.

Most electric actuators are not well suited for continuous modulating control, which is required

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for good boiler control. Many electric actuators are constrained by duty-cycle limitations and can only modulate to the degree that the number of motor starts does not cause the motor to overheat and trip.

This means that the more active a loop needs to be to control the process, the larger the actuator dead band must be to limit the number of motor starts and prevent a complete loss of control. Large dead bands decrease the ability of the damper or valve to make small corrections, which then causes cycling and increased process variability. (See figure 1 below left).

Pneumatic actuators have similar precision and cycling problems but for different reasons.

Pneumatics are susceptible to stick and slip caused by frictional loads and the performance always suffers eventually. Maintenance is always required to keep pneumatic actuators performing in an acceptable range over time. (See figure 2 overleaf ).

OPTIMAL CONTROL: WHAT KEY ACTUATOR CHARACTERISTICS ARE REQUIRED? Actuators should be carefully selected to ensure that they can provide the necessary performance characteristics that will enable a control system to perform as designed. The key characteristics are as follows: t Precise, repeatable positioning typically better than 0.15% of span. t The ability to start and stop instantaneously without dead time or position overshoot. t Continuous duty rating without limitations on the number of start per minute. t Perform consistently and unaffected by load. t Rugged industrial design capable of operating in difficult environments without an effect on performance. t Minimal periodic maintenance required.

An actuator designed with these characteristics provides two extremely important advantages: 1. An ability to follow the demand signal from the controller precisely and instantly. This ensures that the actuator responds exactly as directed by the controller. Thus, the actuator is not the limiting factor in the control loop and the controller can function to its optimal levels.

2. A high degree of maintenance-free reliability.

An actuator designed to function as outlined

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Harold B

CAN YOU REALLY AFFORD A LOW COST ACTUATOR? beck actuators offer greater process availability and more accurate control than pneumatic and typical electric actuators.

Just because an actuator is low priced, doesn’t mean it’s a good value. If excellent return-on-investment is what you’re looking for, take a look at Beck.

Beck electric actuators are the benchmark for actuator performance and reliability. They eliminate the positioning and maintenance problems of pneumatic and typical electric actuators. With Beck actuators on your dampers and valves, you will get the consistent performance your control system is designed to deliver.

Since 1936, Beck actuators have been the best choice for modulating damper and valve control, and now with our digital Control Module (DCM-2) they’re even better. The DCM combines Beck’s high performance and reliability with advanced, intelligent electronics.

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simple local or remote operations requiring no mechanical adjustments. In addition, diagnostics and asset management capabilities have been added to keep your process running smoothly. unreliable actuators.

Contact Beck to learn more about the advantages of precise, continuousduty, lowmaintenance Beck actuators.

R

HAROLD BECK & SONS, INC. WWW.bECkACTUATORS.COm 04/04/2012 25/03/2012 08:16 20:26

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above by default is more rugged than typical actuators. By design, then, it is capable of a much higher degree of reliability.

WHAT CAN BE GAINED? When actuators that are appropriately designed for the task of process control are installed on a boiler, much can be gained from improved process control performance and better reliability. EPRI did a demonstration project at the TVA Kingston plant several years ago to determine how NOx emissions can be reduced simply by employing good control technology without the addition of low NOx burners or expensive selective catalytic reduction (SCR) equipment. In addition to modern distributed control and instrumentation upgrades, the study included the use of Beck electric actuators on all the Kingston boiler control dampers and tilts. Beck was selected for the study based on its long track record of success in the US power industry.

EPRI’s NOx reduction strategy was to improve boiler control and achieve the following: 1. Reduce the oxygen at the burner and introduce air at higher levels to complete combustion.

2. Reduce excess oxygen.

3. Reduce peak furnace temperatures 4. Reduce the particle size of the coal fines.

The EPRI team knew that several areas of control were critical to this strategy. Precise control of the windbox dampers was required to optimize the

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combustion air ratio. From a physical standpoint the burner tilts needed to be controlled much more accurately and reliably to obtain better steam temperature control and reduce tube failures. The coal mill hot air dampers also needed to be controlled accurately. All these objectives were achieved using better instrumentation and better actuators.

The results were astounding. Not only was the boiler efficiency improved, but NOx was reduced by 25%. Prior to the installation, the NOx baseline was 0.6 to 0.7 lb/MMBtu. Within a month of the upgrade completion boiler NOx had been reduced to 0.45 lb/MMBtu, all without the addition of low NOx burners, SCR’s or any other additions to the boiler.

EPRI project leaders attributed two-thirds of all the project benefits directly to the new actuators alone, which meant the investment in the Beck actuators paid for itself in about one-and-a-half years.

EPRI project leaders point out that in addition to reducing NOx and improving efficiency, the new actuators provided many more advantages.

In particular, they noted that the actuators were the major contributing factor to improved steam temperature control, lower turndown, fewer boiler tube failures caused by thermal cycling, and reduced loss on ignition (LOI).

Now, some 15 years after the project completion, the unit is still enjoying the benefits of improved actuation and all the Beck actuators remain in service not only on the demonstration unit but on all the units at the TVA, Kingston facility. Equally important to the improvements themselves, is

the sustainability of the result. The senior plant instrument mechanic involved with the project has said that “the reliability and accuracy of the electric actuators installed at Kingston reduced our workload, allowing the instrument shop personnel to focus on preventive maintenance instead of spending all of their time on corrective maintenance.”

SUMMARY & GROWING ENERGY NEEDS ACROSS Optimum control requires actuators that are capable of continuous modulation and consistent performance over time, with changing conditions, and without required maintenance. These often overlooked capabilities are critical to process control performance. Investments in control systems and field instrumentation are only as useful as the performance of the final control element actuators allow. EPRI proved at the TVA Kingston demonstration project that actuator performance alone is the major contributing factor with respect to boiler control and performance improvements. The results were astounding, with immediate improvements in boiler efficiency and a 25% reduction in NOx. Over the fifteen plus years since the initial project completion, the project success has continued and today all the boilers at the TVA, Kingston plant are equipped with Beck electric actuators. Installing actuators designed for the rigors of continuous modulating process control is the key to optimal control and sustainable improvements.

‘OPTIMUM CONTROL REQUIRES ACTUATORS THAT ARE CAPABLE OF CONTINUOUS MODULATION AND CONSISTENT PERFORMANCE OVER TIME, WITH CHANGING CONDITIONS, AND WITHOUT REQUIRED MAINTENANCE. THESE OFTEN OVERLOOKED CAPABILITIES ARE CRITICAL TO PROCESS CONTROL PERFORMANCE.’ 68 MARCH/APRIL 2012 POWER INSIDER

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CONFERENCE & EXHIBITION IMPACT EXHIBITION & CONVENTION CENTRE, BANGKOK, THAILAND 3 – 5 OCTOBER 2012

CO-LOCATED WITH:

TOWARDS A SECURE ENERGY FUTURE INVITATION TO EXHIBIT Celebrating its 20th Anniversary in 2012, POWER-GEN Asia has established itself as the premier conference and exhibition dedicated to the power generation and transmission and distribution industries.

Attracting 7,000 delegates and attendees from over 60 countries from across South East Asia and around the world, it is the leading industry event to meet and network with senior executive and industry leaders.

Thailand’s GDP is predicted to see a 5.6% growth, leading to a 6% growth in peak power demand between 2012-2016 to 35,600 MW and 44,200 MW by 2021. With current capacity of around 28,500 MW, and despite current energy imports from neighbouring countries, Thailand will see a shortfall in capacity in the next few years.

To gain access to the opportunities within the power industry of Thailand and wider region, you should ensure your presence at POWER-GEN Asia 2012.

We invite you to celebrate 20 years of POWER-GEN Asia with us in Bangkok, Thailand from 3-5 October 2012.

For exhibition and sponsorship opportunities contact:

For information about participating at the conference contact:

Kelvin Marlow Exhibit Sales Manager T: +44 (0) 1992 656 610 C: +44 (0) 7808 587 764 F: +44 (0) 1992 656 700 E: exhibitpga@pennwell.com

Mathilde Sueur Conference Manager T: +44 (0) 1992 656 634 F: +44 (0) 1992 656 700 E: paperspga@pennwell.com

WWW.POWERGENASIA.COM OWNED AND PRODUCED BY:

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20/02/2012 21:32

WIND POWER

BILLIONS BLOWN AWAY ON WIND POWER!

G

overnments are squandering billions of dollars on “uneconomic” wind farms, according to a landmark study that undermines the case for Labor’s huge renewable energy subsidies.

Investment in wind turbines will fail to cut enough greenhouse gas emissions to justify their cost, economists warned yesterday after a detailed British analysis released this week.

The conclusions challenge a cornerstone of Labour’s climate change policy as the federal government pours taxpayer funds into wind projects using direct subsidies, a planned $10 billion investment fund and renewable energy targets.

In a finding with direct relevance to Australia,

the study by University of Edinburgh economics professor Gordon Hughes warns that using wind turbines to cut emissions costs 10 times the price of a gas-fired power station.

“Wind power is an extraordinarily expensive and inefficient way of reducing CO2 emissions when compared with the option of investing in efficient and flexible gas combined-cycle plans,” he concludes.

Professor Hughes, a commissioner on Britain’s Infrastructure Planning Commission and a former World Bank senior adviser, conducted his study for the Global Warming Policy Foundation, which is chaired by former Conservative chancellor Nigel Lawson.

The British study warns of the rising cost to consumers of wind power subsidies on the grounds that governments could achieve the same environmental benefits by other means at much lower cost.

Comparing a pound stg. 13 billion ($19bn) outlay on a combined-cycle gas plant against a pound stg.

120bn outlay on wind farms, Professor Hughes found the renewable energy option was too expensive by any standard.

Wind power would cut emissions at an average cost of pound stg. 270 a tonne, he estimated, but meeting Britain’s greenhouse targets in this way would cost about pound stg. 78bn a year or 4.4 per

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cent of the nation’s GDP. Professor Hughes also warned that greenhouse gas emissions might be higher using wind turbines because the energy supply could be intermittent and would need back-up systems powered by fossil fuels.

“Any reduction in CO2 emissions due to additional wind generation will certainly be much lower than the headline figures quoted by lobbyists for renewable energy,” Professor Hughes writes.

“Without some fundamental technical change, onshore wind power is going to remain uneconomic, especially if external costs are taken into account.”

Frontier Economics managing director Danny Price said Australian policies to favor wind farms,

such as the mandatory renewable energy target and direct subsidies, would be judged a “gigantic waste of money” in retrospect. “The real problem is they’ve put in place a scheme for renewables where the only real option is wind,” he said. “But it is just so incredibly costly it’s not funny.”

Policies should favor a wider array of renewable projects instead, he said.

Anthony Owen of the International Energy Policy Institute in Adelaide said the British findings translated to Australian conditions, with the central conclusions not only being the high cost of wind power but also the fact that it was not zero-emission technology, despite common belief.

“The high capital cost of wind makes it particularly unattractive to private power generation companies in the absence of government subsidies,” Professor Owen told The Australian.

“Gas-fired power generation is very flexible and relatively cheap in terms of capital costs.

“In the form of combined cycle gas turbine technology, it is also a much lower emitter of greenhouse gases - roughly 40 per cent of equivalent coal, in operation.”

Professor Owen said Australia’s wind resources had different characteristics to those in Britain, complicating comparison, but in principle the results carried over.

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SOLAR POWER

ASIA SOLAR MARKET D ONCE AN AFTER-THOUGHT IN SOLAR DEVELOPMENT, THE LATEST DATA SHOWS THE ASIA-PACIFIC REGION IS BECOMING THE INDUSTRY’S BIGGEST MARKET FOR PHOTOVOLTAIC SOLAR POWER.

A

ccording the research performed by Solarbuzz, and presented in its Asia Pacific Major PV Markets report, Asia’s PV market is forecast to increase 39% in the final quarter of 2011. Looking at the numbers annually, between Q4 2010 and Q4 2011, the region’s market will have grown 130%.

Probably the most staggering number offered by the report is that China will account for 45% of the regional demand in Q4 2011. China’s demand is only going to increase in the years to come as the National Energy Administration recently changed its solar installation target for 2015 from 10-gigawatts to 15-gigawatts. With its growing demand, China is set to surpass the United States in yet another cleantech category--solar market size.

China is not the only large Asian country with ambitious clean energy targets. India’s national incentives program is also helping to drive the increased demand for the Asia-Pacific region.

Representing two of the world’s largest and growing economies, the demand in both countries is being fueled by utility-scale projects.

According to regional reports, non-residential

ground mounted systems are projected to represent 64% of the region’s market by the end of 2012.

Conversely, at the beginning of this year, this sector represented only 16% of the market.

Christopher Sunsong, a Solarbuzz analyst, says the Asian markets are filling a gap for solar companies: “As the European markets no longer present certain growth, the Asia Pacific markets are increasingly the focus of international companies looking to expand.” Sunsong also cautioned that there are significant hurdles facing these companies, but the potential of this emerging market is too large to deter major players.

The growth of the market is being buyoed by a sharp decline in cost of solar panels. In the manufacturing realm China is continuing to swallow up large swaths of the global market. This dip in solar prices has led to consolidation of market through the elimination of companies such as Solyndra and Stirling Energy.

It has also led to a trade battle between the United States and China. The U.S. claims its companies, such as Solyndra and Stirling, have been forced out of the market as a result of illegal subsidies offered by

the Chinese government to its solar manufacturers.

Key officials within the U.S. government, such as Secretary of Energy Steven Chu recognize the importance of emerging cleantech markets like the solar industry. Chu has been lobbying hard for the government to create incentives for U.S. companies to be capable of capturing the growing demand for these technologies not only at home, but also in regions like Asia-Pacific.

Speaking at a solar manufacturing plant in Colorado last week, Secretary Chu said, “America has a choice to make today: Are we going to be importers or exporters of solar technologies? We can accept defeat and watch the solar jobs go to China, Germany and other countries, or we can get in the game and play to win.”

Of all the Asia Pacific nations, China emerged from 2011 as the dominant force in the region, growing by 500% over 2010 levels, with 48% of demand in 2011.

A planned year-end 13% feed-in tariff (FIT) reduction led to a surge in fourth quarter (2011) installations, pushing the figure up to a total of 1.7 gigawatts.

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T DEVELOPMENTS

30% GROWTH IN JAPAN WITH HOPEFUL 2012 Japan was the second-largest regional market in the region, with fourth quarter installations up slightly from 2011 third-quarter figures. Year over year, the Japanese market was up 30% in 2011, reaching a total of 1.2 gigawatts, with an additional 40% expected during 2012.

2011, many Indian developers have suffered setbacks due to difficulties associated with financial closure, land acquisition, and power evacuation facilities.

Now developers will need to race to meet their installation deadlines or face the prospect of losing their PPAs, leading to a surge of activity in December and January,” added NPD Solarbuzz analyst Chris Sunsong.

STRONG INDIA DESPITE DELAYS Quarter four saw Indian installations surge by 125% as the project developers strove to meet the installation deadlines. There are still delays on many of the projects, but estimates suggest that quarter one of 2012 could see more than 600 megawatts connected to the grid under the National Solar Mission and Gujarat Solar Policies.

Projects under the Gujarat Solar Policy were granted an additional one-month extension, and estimates suggest that the Indian market could near 1 gigawatt of installed power in 2012.

“While rapid PV price declines have greatly improved project economics over the course of

AUSTRALIA SLUMPS AS INCENTIVES ARE REDUCED Unlike the other three major markets, Australia is trending down with PV installations falling by 10% quarter over quarter. Even worse is that installations in the first quarter of 2012 are expected to decline another 20% as a result of the termination and reduction of a variety of incentive policies during the first half of 2011. The 2012 fiscal year market is expected to fall by 30%.

However, there is hope, as the market is expected to pick up in 2013 as large-scale ground-mounted systems begin to come online across the country.

Despite the significant potential and opportunity

for solar energy development, and the geographic and socioeconomic advantages, most DMCs in the region lag behind developed countries in harnessing solar power. This situation runs the risk of a “solar divide,” where developing countries do not participate in the fruits of green growth that developed countries are pursuing, creating a paradoxical situation where countries rich in solar resources cannot develop their resources while countries with relatively poor solar resources do. This suboptimal utilization of potential is rooted in a number of challenges that DMCs are currently striving to overcome.

Constraints in transmission and distribution grids.

The PV technology road map of the International Energy Agency cites grid accessibility and integration issues as challenges that may prevent solar PV technology from achieving its global objective of providing 11% of global electricity production by 2050.8 The distributed and remote nature of renewable projects limits their coverage through existing transmission grids. Most DMCs are hesitant to deploy limited funds to transmission development for such renewable projects of POWER INSIDER MARCH/APRIL 2012 73

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SOLAR POWER â&#x20AC;&#x2DC;OF ALL THE ASIA PACIFIC NATIONS, CHINA EMERGED FROM 2011 AS THE DOMINANT FORCE IN THE REGION, GROWING BY 500% OVER 2010 LEVELS, WITH 48% OF DEMAND IN 2011.â&#x20AC;&#x2122;

relatively lesser scale (i.e., those generating energy intermittently). Simultaneously, transmission losses can be crippling for solar developers, as the net available energy for sale will be lower. Thus, there is a need to develop an internationally agreed upon set of codes and standards for connecting solar (and other remote location and intermittent renewable energy) projects. Development in smart grid9 and storage technologies is expected to lead to increased deployment of a variety of solar power generation technologies in the region.

High costs and insufficient budgetary resources.

The steep up-front cost of solar projects, high borrowing costs, and the lack of access to long-term capital are stalling solar energy growth. The high cost of solar technologies during the transition stage (i.e., before the costs are competitive with alternate, but polluting, power generation technologies) means that in most cases, they have to be supported through a combination of public funds and user levies, the quantum of which are usually limited by government budget constraints and customer affordability. In this regard, the large-scale participation of Asia and the Pacific in solar energy development is key to a rapid reduction in solar power generation costs and unsubsidized supply.

Lack of appropriate financing mechanisms.

The availability and cost of long-term debt remain one of the biggest challenges for solar energy

project developers in the region. Long-term loans for nonrecourse financing are generally available in emerging markets where there is a directly subsidized FIT, strong power purchase agreement regime, creditworthy offtaker, and clear regulatory signals. Without such an enabling environment, the cost of debt increases, and the available tenor decreases. Loan tenors for renewable energy projects in emerging economies vary typically between 10 and 12 years (sometimes up to 18 years from export credit agencies under arrangements facilitated by OECD), while solar projects have a life of 25 years. Moreover, the risk perception of financiers is distorted due to the very few project-financed solar projects in the region, high dependence on government subsidies, lack of exposure to solar power generation projects among financiers in the region, and inadequate data on insolation levels. These factors become reflected in the high interest rates for debt. Financing solutions that facilitate solar energy investments under such adverse circumstances are needed to catalyze solar energy development in the region.

Constraints in institutional capacity. Although some DMCs, such as the PRC, India, and Thailand, have formulated policy and regulatory frameworks for the promotion of solar energy, many DMCs lack the institutional capacity to design and develop these frameworks, thereby creating a demand pull for solar energy. Weak institutional capacity of government

is viewed as risky by investors hesitant to commit to projects that rely exclusively on support mechanisms that are not well developed, have shorter durations, or are likely to change over time. Generally, the lack of strategic capacity-building and training activities, and parallel research and development programs, are key obstacles to stimulating catalytic solar energy development in Asia and the Pacific. The spread of knowledge and good practices on the various issues and aspects of solar energy will be helpful in enhancing and strengthening the sector in the region.

Inadequate coordination of knowledge management activities highlighting existing information gaps. Most DMCs pursuing solar energy development often set targets for, and offer projects on, publicâ&#x20AC;&#x201C;private partnerships without adequate project preparatory measures, and with insufficient data on solar insolation and climate conditions that influence the output of solar power generation.

Thus, information and perception gaps persist in the minds of investors, manufacturers, suppliers, and financiers, who play a major role in implementing solar energy development policy. Further, the absence of a comprehensive knowledge-sharing mechanism exclusively for solar energy and stable grid development in the region accentuates this gap by limiting the dissemination of lessons learned and best practices to local stakeholders, policy makers, and project developers.

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